Leeds Is Attracting Talent, but Its Young Workers Are a Flight Risk

Leeds is increasingly attracting talent from outside the city, small businesses in Leeds have said in a new survey.

The research, carried out by market research company Savanta among 500 small business decision-makers and 1,500 workers across Leeds and Manchester, found that small to medium enterprises (SMEs) in Leeds have seen more job applications from outside the city over the past two years.

The trend shows nearly six in ten Leeds SMEs (59%) have seen more job applicants from outside the city or region over that period, and it comes as the Government puts the North at the centre of its growth agenda. 

Leeds Economy: Small Business Employment Growth

The rise in applications from outside the city makes sense given that 61% of Leeds’ workforce moved in from somewhere else, a figure which suggests that incomers are the norm there rather than the exception, against 52% in Manchester.

Employment Hero’s payroll data also shows that those employers are adding staff. Employment at small businesses in Leeds grew 12.1% in the three months to September, five times the 2.4% recorded in Manchester, and 58% of Leeds small businesses expect to grow their headcount over the next 12 months.

Leeds Workers and What Keeps Them in the City

While pay is usually a significant deciding factor in where people seek to work, the survey shows some 61% of Leeds workers would stay on their current salary rather than relocate for a higher one, and 43% have turned down, or chosen not to pursue, a job elsewhere in order to stay.

For those who seriously weighed up leaving and stayed anyway, relationships carried the most weight, with family and friends being cited as the most common reason (35%), followed by partner or family circumstances (24%). Flexible working (23%) ranked above salary (18%).

Rachel Woolford, founder of Leeds-based fitness business North Studio and winner of BBC’s The Apprentice 2024, sees the same pattern when she recruits. 

“Leeds has really grown into itself over the last few years. We’re seeing more established businesses setting up here, creating great career opportunities,” she said, adding: 

“In my experience, what keeps people isn’t just pay. It’s the career opportunities, the lifestyle and feeling part of something.”

Early-Career Workers and the Retention Gap

The picture is less settled for people starting out, however. More than four in 10 early-career workers in Leeds (44%) have seriously considered leaving the city for a career opportunity in the past two years, against around a quarter (26%) in Manchester. Fewer than one in five Leeds workers aged 25 to 34 (17%) describe themselves as firmly rooted in the city, while almost a third (32%) of their Manchester peers do.

Even so, 25 to 34-year-olds in Leeds are largely positive about their careers in the city. Three-quarters of them (76%) feel more confident about building a career in the city than they did two years ago. 

Michael Mitchell, VP of Sales, UK, at Employment Hero, who was born and raised in Leeds, believes the momentum the data shows could keep going under the right circumstances. 

“Leeds has everything I need to build a successful career and a great life,” he said. For the next generation.

“The challenge is making sure Leeds keeps offering the opportunities and progression that will convince the next generation to stay.”

Andy Burnham’s Devolution Plans and Business Rates

Those opportunities may well spring up faster now that Prime Minister Andy Burnham has afforded UK regions more power. After opening No10 North in Manchester as a base for growth and devolution work, with regional mayors due to keep a share of business rates from spring 2027 and a share of income tax from 2028, the response from those who advise small businesses has been cautious. 

Speaking about the Prime Minister’s early pledges, Jerry Riches, associate director at Business Finance Trust, which advises small businesses on funding and cashflow, said the firms he works with have “heard that message for two years while being hit from all angles”, he told Employment Hero’s UK Newsroom in July. “Actions speak louder than words.”

When it comes to retaining the 44% of early-career workers in Leeds who have seriously considered leaving in the past two years and increasing the proportion of 25-34-year-olds who feel firmly rooted in the city, employers’ ability to offer more than a higher salary will be put to the test. 

Leeds has already shown it has the capacity to draw in more talent from elsewhere than Manchester. Keeping its young workers is the next frontier.