Peterborough has emerged as the top city in Britain for small business employment, according to new research from iwoca, one of Europe’s largest small business lenders.
The study, titled ‘Top 25 Towns & Cities for SME Jobs,’ uses data from the Office for National Statistics (ONS) to rank areas based on factors such as average wage, commute time, job density, house prices, and the growth of small businesses.
Peterborough secured the first place due to its short commute times and significant growth in small businesses. Residents of Peterborough typically spend 17 minutes commuting, a stark contrast to the 40-minute average for Greater London. The city also boasts the second-highest rate of SME growth in the UK, with a 19% increase in small businesses from 2018 to 2023. This impressive growth has propelled Peterborough from 19th place to the top of the list this year.
Located less than an hour from the tech hub of Cambridge, Peterborough benefits from an innovative business environment while maintaining affordable house prices, averaging £232,500 compared to Cambridge’s £490,250. The recent opening of a new Anglia Ruskin University campus in Peterborough, offering courses tailored to local employers’ needs, has further bolstered the city’s appeal for jobseekers.
Preston and Newcastle Climb the Ranks
Preston has risen from ninth to second place on the list, driven by a strong job market and increasing wages. The city’s job density ratio, which measures the number of jobs available per worker, is the ninth highest in the country at 1.11. Additionally, hourly pay in Preston has increased by almost £1 over the past year, now averaging £18.41.
Newcastle has also seen a rise, moving from seventh to third place. This improvement is attributed to an increase in hourly pay, from £18.11 to £19.41, and affordable housing, with median house prices at £175,000. By comparison, St Albans is the most expensive British city for home ownership, with average house prices at £625,000.
London Absent from Top 25 for SME Jobs
Despite its status as a key destination for jobseekers, Greater London did not make the top 25 list for SME jobs for the third consecutive year. The capital ranks 83rd, largely due to its high median house prices (£530,000) and long commute times (40 minutes), despite offering high average hourly pay (£26.31).
The bottom three cities in the ranking, all located in the South East, are Epping Forest, Tonbridge and Malling, and Lewes. These areas suffer from lengthy commutes and slow small business growth.
Seema Desai, COO at iwoca, highlighted the importance of SMEs: “SMEs are not only huge assets to our high streets – but they provide millions of opportunities for jobseekers of all levels and generations. Beyond the much-talked-about large corporations, SMEs give workers the fulfilling and diverse careers they strive for, and it’s fantastic to see these opportunities being spread across the country.”