People who have not visited Sunderland recently may have been surprised at the news on Thursday that Nissan is investing £1bn into a futuristic electric vehicle hub in the city.
Known for its heavy industry and shipbuilding history, Sunderland is overshadowed by its industrial past and may not be the first place that comes to mind when imagining the future of manufacturing. But it should be, according to Patrick Melia, chief executive of Sunderland city council. “It’s a transforming city,” he said.
Between the council and national government, £100m is being invested into a hi-tech manufacturing park adjacent to the Nissan plant, which before the announcement from the Japanese carmaker was expected to generate between £500m and £600m of investment from the private sector. With the £423m from Nissan and £450m from battery maker Envision, this target has already been smashed.
“We need to be enablers as a local authority. We don’t always have a lot of cash to put in but what we have is expertise, and we know how to bring businesses to Sunderland and benefit the wider north-east region,” Melia said.
The Brexit effect, which some Remainers had gleefully wished upon Leave-voting Sunderland, has failed to materialise here. Though there is still uncertainty about food production due to shortages of factory, agricultural and haulage workers – issues that exist throughout the UK – Sunderland seems to have come out largely unscathed.
Despite this, challenges remain, with unemployment higher than the national average and pay significantly lower, at a time when the city is suffering from higher rates of Covid-19 infections than the country at large.
Already struggling before the pandemic struck, Sunderland ranked in the top 20 local authorities in Britain for employment deprivation, according to government figures.
The percentage of the workforce claiming unemployment-related benefits had shot up to 7.3% by May this year, compared with a UK average of 6%. And despite progress in recent months as lockdown measures were gradually relaxed across the country, about a tenth of the local workforce is still on furlough.
And yet Sunderland has ambitious plans. In 2023, the city is holding its Future Living Expo, which will showcase 5G-enabled, renewable-energy-powered “homes of the future”, 1,000 of which are currently planned for Sunderland, built off-site outside the city and assembled in four new neighbourhoods in the north of the city centre.
“They will be more sustainable, and the smartest homes in the UK when we build them,” Melia said. “So we’re on a transformational journey and you need things like [Nissan’s investment] to underpin all of that.”
In 2019, the financial services company Legal & General pledged £100m to the city’s regeneration efforts, aiming to create grade-A office space at “Riverside Sunderland”, an “urban quarter” to the north of the city on the bank of the River Wear.
Work on the project will begin next month, at the site of the former Vaux Breweries, which closed in 1999. The site has been empty for two decades, partly due to numerous planning rows for Tesco, which had tried to build a superstore there, until it was bought by the council in 2011.
Legal & General’s chief executive, Nigel Wilson, himself a north-east native, said there were “massive shifts” going on in the region as it responded to the emergence of green tech and the rise in renewable energy. The company’s investment in Sunderland was about seizing a genuine opportunity, he said – one that was missed at the turn of the millennium, when the UK failed to support fledgling tech companies and lost ground to the US and China.
He said: “We missed the boat. However, this next wave of technology is coming along incredibly quickly.”
Legal & General has put £22bn of pensions money into projects such as urban regeneration, clean energy and transport infrastructure across the UK. “We’ve been saying this for many, many years and we’ve been practising it for many, many years. But it’s now become trendy and popular.”
Wilson said business had been the catalyst for change in Sunderland but he believed the government had also been supportive.
“For a lot of things, [the private sector] can do it, and then there are certain things where the government needs to pump-prime, to be frank.”
With taxpayer money underpinning the investment at Nissan, the government’s “levelling-up” rhetoric now has a ring of reality to it here. The sums committed are small but symbolic, suggesting that the interventionist approach that characterised postwar industrial policy is back in fashion.
Within the city, companies still feel a strong attachment to their home turf, determined to resist what is often described as the “magnetic pull” of the south-east.
At Keel Square, across the road from the Vaux Breweries site, is the new £6.4m head office of Hays Travel, a Sunderland success story.
Founded by John Hays in 1980, the company has grown to become the UK’s largest independent travel agent, with a workforce of 500 at the Sunderland head office and 7,000 elsewhere in the UK. It made headlines most recently when it bought the retail arm of Thomas Cook after the holiday giant went bust in 2019.
Dame Irene Hays, the owner and chair of the company, said she and her late husband John, who died suddenly last November, never considered moving the business elsewhere.
“We have for 41 years attributed our success to the loyalty, commitment, skills and flexibility of the thousands of lovely people we have been able to employ and develop from this area,” she said.
Sunderland was an attractive place to relocate, she said, due to its “beautiful coastline and thriving cultural scene” which meant the company had been able to recruit a “diverse and adaptable workforce”.
Part of that cultural scene is the Sunderland Empire, the biggest theatre in the region and the only one that can accommodate the largest touring West End shows.
It directly employs more than 100 people and, with 300,000 visitors in a typical year, supports many further jobs in hospitality around the city. The Empire has been closed for more than a year, with almost all of its staff furloughed, but the box office is open and already taking bookings for the winter-season pantomimes.
The theatre’s director, Marie Nixon, said the optimism felt by the council and business was translating into a thriving cultural sector, albeit one that had been hit hard by the pandemic. While it remains to be seen what the lasting effects of lockdown will be, Sunderland is “creating more opportunities than ever before” for artistic types who might have left the city for the brighter lights of Newcastle, Leeds or further south.
“I’m feeling really optimistic,” said Nixon. “I think we just need what everybody needs and that’s some certainty.”