Strong first quarter sees hospitality drive growth in city centres

By Gary Lloyd

- Last updated on GMT

Recovery leader: Edinburgh leads the top 10 vibrancy cities in the UK (Credit: Getty/CHUNYIP WONG)
Recovery leader: Edinburgh leads the top 10 vibrancy cities in the UK (Credit: Getty/CHUNYIP WONG)

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Hospitality is driving year-on-year growth in UK city centres despite high inflation levels continuing to batter trade.

Edinburgh topped the list of the new ‘Top Cities’ report from CGA by NIQ and Wireless Social when it comes to sales and internet log-ins, with London, which has been lagging behind recently, shooting up to second place after office workers and visitors returned to the capital during the first three months of 2023.

However, the year-on-year comparisons benefit from weak trading in early 2022, when concerns about the Omicron variant of Covid kept some consumers away from city venues. Growth has also been impacted by high inflation, which means trading for many operators remains well behind last year’s levels in real terms.

The report combines sales data with check-in data to produce a ‘vibrancy’ ranking of the 10 cities in the first quarter.

Third place went to Sheffield as the best performing city in the north of England while Glasgow solidified Scotland’s credentials by claiming fourth spot.

Rail strikes affect recovery

At the other end of the table are Leeds, Birmingham and Liverpool, where the cost-of-living crisis and rail strikes have put the brakes on the post-Covid recovery in footfall.

CGA client director Chris Jeffrey said: “This research shows consumers remain very keen to visit city centre pubs, bars and restaurants despite the squeeze on their discretionary spending.

“While high inflation continues to make trading conditions difficult, hospitality is a resilient and dynamic sector that is helping to breathe life back into cities’ economies after the turmoil of the pandemic.

“It deserves targeted and sustained support from Government to sustain hard-working businesses through the costs crisis.”

Rates system ‘not fit for purpose’

Julian Ross, founder and CEO of Wireless Social, said: “Footfall and sales remain strong in major hubs all over the UK, especially across competitive socialising and more experience-led concepts that have emerged and blossomed since the pandemic. Consumers are looking to get as much for their money as possible, and that is what these operators are capitalising on.

“However, the market is still fraught with economic obstacles that are continuing to pose a serious threat to the survival of many businesses.

“Soaring energy bills, grossly inflated supply chain costs, an ongoing labour crisis and a business rates system that is simply not fit for purpose, are just some of these issues, and it’s absolutely vital the sector continues to receive as much support as it can get.

“Without the requisite support, the road ahead is set to be extremely rocky for our sector.”

Britain’s 10 biggest cities, ranked by vibrancy: Q1 of 2023

1. Edinburgh

2. London

3. Sheffield

4. Glasgow

5. Bristol

6. Leicester

7. Manchester

8. Liverpool

9. Birmingham

10. Leeds

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