Pictured above: Scott Rutherford

Birmingham's performance in a major annual survey aimed at finding out which European city is the best to do business has slipped.

The survey - Cushman & Wakefield's European Cities Monitor (ECM) 2010 - saw the city ranked 18th 'best city to locate a business' in 2010, compared with 14th position a year ago - and leapfrogged by northern rival Manchester.

However, both cities have now broken away from the rest of the UK, with locations such as Leeds, Edinburgh and Glasgow lagging behind.

The ECM survey is based on the views of more than 500 senior executives from Europe's largest companies. It provides an overview of the perceptions that corporate occupiers have about the various cities of Europe.

The overall 'best for business' ranking saw a number of European cities perform better this year, and Birmingham's fall hides the fact that perceptions of the city have actually held up in what has become an increasingly competitive environment to capture business.

The ECM data produces various other rankings, and Birmingham's best performance is in 'best city in terms of availability of office space', where it is fourth equal with London, compared to fifth a year ago. The city also ranked fifth, behind Leeds and Glasgow for 'best city in terms of value for money and office space'.

In terms of the city's ranking for being the best in the factors rated as the most important for locating a business - ease of access to markets, availability of staff, quality of telecommunications and transportation - its performance has been mixed.

Where the most important factor is concerned - ease of access to markets - Birmingham has an above average score and is well ahead of all its UK rivals. It has also seen a rise in perception in terms of quality of telecommunications, although for transportation this has gone down. 

Birmingham remains on the radar as overall being one of the top 20 cities in Europe in which to do business, and its relatively poor performance this year is being blamed on the effects of the recession, which has hit the West Midlands harder than most.

Scott Rutherford, head of the Birmingham office of Cushman & Wakefield, said that the city's move away from manufacturing to a more service-based economy in the past quarter of a century was undoubtedly a factor that  had affected its performance in this year's survey. 

He said the fortunes of the financial and legal sectors, for example, were closely linked to what was happening globally, and had therefore been very much in the firing line when the banking-led recession came along.

He added: "On the positive side, Birmingham is a well known business destination and the investment and redevelopment seen during the last decade has helped transform and revitalise it, which should help bolster future economic growth.

"It also shouldn't be forgotten that Birmingham is ranked in the top half of the tables for ten our of the 12 rankings, with the softer quality of life and freedom from pollution rankings the only area where the city was marked down towards the bottom."

Mr Rutherford said that 2010 European Cities Monitor survey suggested that Birmingham was still viewed as a leading European city, without any major weaknesses, and would probably be able to recover its rankings once the effects of the UK's economic austerity had worn off.