I was at Salford University in the mid 60's which is where I first heard the song (sung by the Spinners, I think) and the words fitted the city as I knew it in those days. But as Jim Carrol rightly said, the words would fit any industrial town in those days.

To expand on my response to Gazza2, there was a weir on the river Irwell close to one of the buildings where I used to have a fair number of my lectures and the churning of the water over the weir created a raft of dense yellow-brown foam of considerable thickness on the surface. This was a result of discharges from a dye works further up river and it stopped when the dye works closed.

I never really gave a thought to the "train set the night on fire" line as it so perfectly described a steam train working hard. A hard working steam loco would chuck out sparks from its chimney which could be seen at night. In addition if the train was a passenger train you would also have the effect of the lights from the carriages.