Cities in the north of England need elected mayors with economic development powers if they are to compete with their southern counterparts, according to a report released today by a leading UK think tank.

The Policy Exchange Silicon Cities report argues that mayors with such powers would be able to prevent the "brain drain" that sees skilled workers in the north move to London and the South East in search of a job.

According to Policy Exchange, over a third of graduates from major universities leave the North East (37 percent) and North West (36 percent), while as many as 55 percent leave Yorkshire and the Humber. For science, technology, engineering and maths, the figures are 35 percent, 34 percent and 52 percent respectively and those from the top ranked universities leave in higher numbers, according to Policy Exchange.

Introducing local government reforms to catalyse the creation of technology "clusters" could help address this, report author Eddie Copeland said.

“While the technology industry is bringing considerable benefits to the UK economy seen as a whole, it is failing to live up to the Chancellor’s wish for it to benefit ‘every corner of the country’.

“The question for policymakers is how to extend the sector’s benefits to other regions, especially England’s northern cities so we can create ‘Silicon Sheffield’ or ‘Silicon Sunderland’.”

The conservative think tank believes that ministers need to put “rocket boosters” under local governance and back directly elected mayors in order to help northern tech clusters flourish.

Approximately 1.2 million people in the UK are employed in the technology sector but the number of people employed in the South East region is out of kilter with the rest of the country, according to a recent study.  

Research by KPMG and Markit showed that the concentration of tech employment in the South East is greater than the national average in as many as 47 out of 66 local authorities.

Indeed, Wokingham has more than five times the national proportion of technology workers, while 21 out of 33 local authorities in London have a higher proportion of workers employed in technology related roles than the national average.

Earlier this year, the government changed Tech City UK's remit from supporting tech companies purely in London to supporting tech companies across the country. However, today's report suggests that the taxpayer funded organisation still has a long way to go. 

In addition to elected mayors, the think tank advocates that rail and road links across the north need to be improved if tech clusters in the region are to thrive. Specifically, it says that HS3 should be carefully considered, while there is a clear need for a high speed trans-pennine route.

Osborne revealed last week that he plans to put devolution to northern citiies, including mayors, at the core of the Autumn Statement. 

In June, he revealed his vision for joining up northern tech clusters. 

"Durham, Lancaster, Leeds, Liverpool, Manchester, Newcastle, Sheffield and York and more – the north is blessed with world class universities," he said. "We want to see science here turned into products here - and into jobs and growth here."

Osborne said that the cities of the north are individually strong but "collectively not strong enough".

“We need a Northern Powerhouse," he said. “Not one city, but a collection of northern cities - sufficiently close to each other that combined they can take on the world."