Even on a rainy, windy October’s day, it is not difficult to see why York is one of the most visited cities in England, pulling in some 7 million visitors a year. From its iconic cathedral to the medieval walkways of the Shambles, it looks precisely the way international visitors want to believe that all English cities look. And it has the history to back it up: its life as a city dates back as early as the first millennium AD.

Being a tourist magnet is no bad thing on the face of it, but York wrestles with the kinds of problems that other such cities face: how to be more than just a nice jaunt for UK daytrippers or a place to tick off the lists of holidaying history nerds from abroad? And being steeped in history can be a positive, but only provided the place does not get stuck in the past and the economy can roll with the times. The kind of modern image that is necessary to attract high-value businesses can be at odds with the quaint imagery that appeals to visitors.

Away from the 'lovely'

“York has international brand recognition because of our history. If you say York, people say ‘ooh, lovely’, even if they have never been here. But ‘ooh, lovely’ doesn’t make a hi-tech company want to locate here,” says Lady Jane Gibson, chairman of a newly created organisation, called Make It York, that intends to help square that circle. Make It York, which is backed by York's city council, will promote the city nationally and internationally for culture, tourism, business and FDI, and also tout its management of its historic city-centre.

“In the past, all of this was fragmented and as a result the brand was fragmented,” says Ms Gibson. “Our message is that York is a compelling, exceptional world city.” 

Kersten England, chief executive of the City of York Council, says the visitor economy does not necessarily need to be at odds with efforts to develop more advanced sectors – they can feed off each other. The key is balance, she says, which is something York is striving towards.

“The balance in the economy is not where we want it to be; we have a high proportion of service sector jobs [because of the tourist industry] and what we actually want is to grow more high-valued-added jobs, and find areas where we can differentiate ourselves, such as with our bio-economy,” says Ms England.

“We set for ourselves the challenge of increasing the productivity of the city through driving up the quality of the visitor offer and the productivity of that sector, and targeting inward investments in high-valued-added sectors, to try to get that rebalancing.”

A modern twist

There is a strong presence already of financial and professional services firms in York, and optimism over a flowering financial technology sector, which was given a boost by San Francisco-based fintech company Anaplan’s doubling of its presence in the city over the past few months. Insurer Aviva employs a few thousand people, and fellow insurer Hiscox UK is building a new flagship northern headquarters in York, creating 500 new jobs.

The bio-economy in York, meanwhile, has surprising and somewhat unsung assets, off the back of York University’s expertise in biofuels research. At York Science Park, a biorenewables centre opened in 2012 that joins up two university R&D centres – the Centre for Novel Agricultural Products and the Green Chemistry Centre of Excellence – and combines the expertise of plant scientists, biologists and chemical/process engineers in order to best extract chemicals from plants that can be turned to biofuel.

There is also a lot of collaboration with Brazil, a major biomass producer. Another larger centre will open nearby in late 2016, offering plug-and-play space for companies in bio industries. A £750m ($1.18bn) development plan for the university calls for the addition of commercial space and an extension of the science park.

New, old industries

But even York's older industries are refusing to remain static. The rail sector has deep and illustrious roots – York's railway station was the largest in Europe at the time of its birth in the 1800s – and remains a big employer. Rail travel carries an old-fashioned mystique but in fact the rail industry of today is a hi-tech affair, and requires innovation as much any other advanced engineering sector. And so it is in York, where Network Rail – which employs approximately 1500 people in the city – has just opened a £36m signalling and training centre. This investment is just in the facility; the new signalling systems themselves involve an investment of hundreds of millions of pounds.

Billed as the most advanced rail training centre in the UK, Network Rail's centre will help prepare the UK's rail network to move to a system without external signals by 2019 – a seismic change for the industry requiring masses of new technology and skills.

Adjacent to the new centre, Network Rail is working with the city to develop York Central, a 35-hectare brownfield site on which up to 480 new housing units and a spate of grade-A office buildings are planned. There is capacity for up to 80,000 square metres of office space – which would relieve pressure on the city centre where high-quality office space is in short supply due to its historic character. Attracting larger employers to the city without being able to offer them room to grow has posed problems. There are hopes that York Central will offer just that, and on the doorstep of the rail station, making it convenient for commuters and executives on the move.

With this development, York officials are now confident they have a strong offer to take to transport technology companies, as well as financial and professional services firms who would appreciate a location that sits on a rail line that runs directly between the financial centres of London and Edinburgh. “This site is key to being able to offer companies an attractive and convenient place for a new headquarters,” says Andrew Sharp, strategy and investment manager at York's city council.

Hiscox, it must be said, brought its headquarters into the cramped city-centre, but if more are to follow, they might not need to venture much beyond the station – which keeps rail right at York’s beating heart, just as it has been since Victorian times.