Is Manchester a victim of its tech-hub success?
In recent months Manchester has attracted some notable technology giants to its red-brick streets – it’s a trend the city is becoming increasingly accustomed to. Most notably US online retailer Amazon announced 600 new jobs in the Hanover Building in the city’s Northern Quarter at the end of 2018, whilst announcing plans to hire 1,000 more technology, research and other skilled workers in the UK by next year. Then in December, Hewlett-Packard followed suit announcing it had taken a ten-year lease on 20,000 square feet of office space on Oxford Road for around 200 permanent and 100 flexible staff.
The northwest is an increasingly attractive place to do business and live and it’s an ever-growing impressive list of progressive digital brands that see Manchester and more widely the northwest as a tech-hub providing the skills and talent being showcased via the drive towards The Northern Powerhouse. What these companies have in common is an increasing ambition to become digitally native businesses that can scale at speed with market changes. Sainsbury’s has made no secret of its bid to ‘reinvent itself as a digital retail leader’ – announcing its intention back in 2012. It was this move to be a true dotcom that fuelled its relocation and growth in a digital and technology team based in Manchester back in 2016.
However, this movement north brings some cost challenges to those who take the leap of faith in relocating. Currently salaries in the north remain competitive to those organisations looking outside of London when moving their operations. But this is under threat as plush new office developments attract businesses, driving up the cost of salaries and recruitment fees as they look to attract and retain employees in an expanding region. The talent pool, although growing, is unquestionably smaller than that of the capital and pressure on companies to hire the right people to drive their business is ultimately driving up salaries. As the larger brands snap up the talent, the smaller dotcoms struggle to compete.
Roles and responsibilities also move up a gear. Software development teams require ‘agile coaches’, ‘software development managers’ and ‘DevOps’ personnel – the bringing together of software development and software delivery in a commercially beneficial infrastructure. Such roles have perhaps previously been the monopoly of larger southern-based software development teams and finding those skill sets in the northwest is challenging in the short-term – especially when rapidly scaling teams. It’s important to recognise that although changes are happening, it will take some time for the existing skills gap to close. That’s part and parcel of the development of the region and of our skills as a nation in terms of education. There aren’t enough software development graduates, never mind developers in the region.
So, is Manchester a victim of it’s own success? For now the city has some challenges to face as the region becomes home to the digital teams in some of the country’s largest brands. Outsourced software development partners are able to provide the skill sets for rapid development – be that a move into a new market or dominance of existing ones. Even scaling for seasonality in trading – such as Christmas
Nearshorers like Godel can offer clients teams of talented software developers who can be ‘plugged-in’ to the in-house development teams almost instantly, providing rapid scalability. Delivered from software development centres of excellence in Belarus whilst being headquartered in Manchester city centre, the region’s digitally native businesses can enjoy the benefits of having the right developers at hand to meet the business challenges they face. Minsk has over 60 universities with thousands of software development graduates each year – that’s a dearth of talent at their disposal.
Manchester’s new neighbours have what they need to be able to grow, and there is confidence that Manchester can rightfully be crowned the second largest tech-hub in the UK.