Cheltenham: Its Economy, Its Future - One Year On
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Cheltenham’s Economy -
Aan analysis of current and future trends
(DRAFT)
Report to
Cheltenham Borough Council
March 2008
Contents
1. Introduction 1
1.1 Context 1
1.2 Structure of the Report 1
2. Population, Migration and Housing 2
2.1 Population 2
2.2 Migration 4
2.3 Self-containment and commuting 6
2.4 Future Development 6
2.4.1 Development Strategy 6
2.4.2 House Prices 7
2.5 Summary 9
3. The Economy 10
3.1 Global Economic Issues 10
3.2 Local Economic Trends - GVA 10
3.2.1 GVA per head 11
3.2.2 GVA by sector 12
3.3 Earnings 14
3.4 Employment and Industrial Structure 14
3.4.1 Employment trends 14
3.4.2 Jobs Density 15
3.4.3 Levels of self-employment 16
3.4.4 Industrial Structure 16
3.4.5 Employment by Occupation 19
3.5 Key and Emerging Sectors 19
3.5.1 Creative Industries 21
3.5.2 Environmental Technologies 23
3.6 Business Structure and Entrepreneurial activity 25
3.6.1 Sizeband Analysis 25
3.6.2 VAT registrations / de-registrations 26
3.6.3 Business Survival rates 28
3.7 Summary 29
4. The Labour Force 31
4.1 Education 31
4.1.1 GCSE Results 31
4.1.2 Participation post-16 31
4.1.3 Further and Higher Education 32
4.2 Unemployment 33
4.2.1 Unemployment by Age and Duration 33
4.3 Economic activity rates 34
4.4 Qualifications of the workforce 35
4.5 Skills Issues 37
4.6 Summary 40
5. Social Exclusion & Deprivation 41
5.1 Indices of Deprivation 2007 41
5.2 Benefits Claimants 42
5.3 Summary 44
6. Conclusions 45
References & Data Sources 47
Annex 1 - Detailed Data Tables 48
List of Tables
Table 2.1: Population Change 2002-2006 2
Table 2.2: Non-UK NINo registrations, 2004/05 to 2006/07, Gloucestershire, South West and UK 6
Table 2.3: Growth in Average House Prices, Gloucestershire, South West and England & Wales, 2001-2007 8
Table 3.1: GVA Per Head - Cheltenham compared to National 2001-2006 (£) 12
Table 3.2: Employment change in Gloucestershire, South West and Great Britain, 2002-2006 (Total Employees) 15
Table 3.3: Employment change in Cheltenham, Gloucester and Great Britain, 2002-2006 (Full and Part Time Employees) 15
Table 3.4: Occupational Structure, Cheltenham, Gloucester and Great Britain, 2007 19
Table 3.5: Employment in Creative Industries in Cheltenham, Gloucester and Great Britain, 2003-2006 22
Table 3.6: Employment in Environmental Technologies in Cheltenham, Gloucester and Great Britain, 2003-2006 23
Table 3.7: Stock of VAT registered businesses, Cheltenham, Gloucester and Great Britain, 2001-2006 26
Table 3.8: One and Three Year Business Survival Rates, Cheltenham, Gloucester and England 29
Table 4.1: GCSE Results, Cheltenham, Gloucester and England, 1997-2007 31
Table 4.2: Participation in HE of people aged 18-20, Cheltenham, Gloucester and England, 1999/2000-2005/06 32
Table 4.3: Unemployment by Age & Duration, Cheltenham, Gloucester and Great Britain, December 2007 34
Table 4.4: Qualifications at Level 2, 3 and above, international comparison, 2003 (total workforce aged 16-64) 35
Table 4.5: National Employer Skills Survey Indicators, 2003-2005 39
Table 5.1 Index of Multiple Deprivation district ranks 41
Table 5.2: Top ten most deprived Super Output Areas in Cheltenham and Gloucester, 2007 42
Table 5.3: Working Age Benefit Claimants, Cheltenham, Gloucester and Great Britain, 2001-2007 43
List of Figures
Figure 2.1: Forecast Population Change 2004-2029 3
Figure 2.2: Population by Age 2006 3
Figure 2.3: Forecast Population Change by Age 2004-2029 4
Figure 2.4: Non-UK NINo registrations in Cheltenham and Gloucester, 2002/03 to 2006/07 5
Figure 2.5: House Price Affordability, 2002-2007 8
Figure 3.1: Cheltenham GVA at Basic Prices, 1994-2006 (£ million) 11
Figure 3.2: Composition of GVA by Output Sector 2006 (%) 12
Figure 3.3: Change in GVA by Output Sector 2005-2006 (%) 13
Figure 3.4: Average Gross Weekly Pay, Cheltenham and Gloucester compared with GB, 2002-2007 14
Figure 3.5: Jobs Density, Cheltenham and Gloucester compared with GB, 2000-2005 16
Figure 3.6: Distribution of employees by broad industrial sector, Cheltenham, Gloucester and Great Britain, 2006 17
Figure 3.7: Employment change by broad industrial sector, Cheltenham, Gloucester and Great Britain, 2005-2006 (% change) 18
Figure 3.8: Structure of Creative Industries Employment, Cheltenham, Gloucester and Great Britain, 2006 22
Figure 3.9: Structure of Environmental Technologies Employment, Cheltenham, Gloucester and Great Britain, 2006 24
Figure 3.10: Number of Businesses by sizeband, Cheltenham, Gloucester and Great Britain, 2006 25
Figure 3.11: Number of Employees by sizeband, Cheltenham, Gloucester and Great Britain, 2006 26
Figure 3.12: Change in the stock of VAT registered businesses, Cheltenham, Gloucester and Great Britain, 2001-2006 (year on year percentage change) 27
Figure 3.13: VAT registrations and deregistrations by industry, Cheltenham, 2006 28
Figure 4.1: Participation in full-time education of 16 & 17 year olds, Gloucestershire, South West and England, 2002-2005 32
Figure 4.2: Claimant Count Unemployment Rate, Cheltenham, Gloucester and England, 2000-2007 33
Figure 4.3: Unemployment by Age & Duration, Cheltenham (no. of claimants) 2001- 2007 34
Figure 4.4: Economic Activity Rates, Cheltenham, Gloucester and England, 2004-2006 35
Figure 4.5: Qualification levels of the workforce, Cheltenham, Gloucester and England, 2006 36
Figure 4.6: Qualification levels of the workforce, Cheltenham, 2001-2006 37
Figure 5.1: Claimants of ‘out of work’ benefits, Cheltenham, 2001-2007 43
Executive Summary
Population, Migration and Housing
• Cheltenham’s population has grown significantly slower than Gloucester, the surrounding county and regional and national averages,
• This slow growth is forecast to carry on over the next two decades, which would result in Gloucester becoming a significantly larger settlement than Cheltenham.
• Significant changes to the structure of the population are also forecast, with declining numbers of young people and huge increases in the numbers of people aged over 65. Although it is following the broad national trend of an ageing population, the implication for Cheltenham is that limited overall population growth and falling numbers of young people will result in negligible growth in the labour force. This could then restrict the ability of Cheltenham’s economy to grow without increased levels of inward commuting, placing further strain on an already congested road network and increasing pressure on the environment.
• There has been a huge increase in the numbers of migrant workers coming into Cheltenham and Gloucester since the expansion of the EU in 2004. Although there is limited evidence regarding how long migrant workers actually stay in the UK, since 200? the number of new NINo registrations is around 1,400 per year in Cheltenham.
• Increases in house prices have far outstripped growth in average wages, resulting in consistently falling affordability in recent years.
• Factors for the slower population growth include a constraint through the lack of development land for housing. The planned urban extensions outlined in the RSS will be crucial for enabling future economic growth in Cheltenham, and avoiding the realisation of the current demographic forecast, which is based on the current lack of available development land. It should be emphasised that the planned urban extensions are NOT factored into the population forecasts.
The Economy
• The total value of goods and services produced in Cheltenham was estimated to be £2,096 million in 2006, slightly higher than in 2005, but lower than its peak of £2,451 in 2003.
• In 2006, GVA per head in Cheltenham was £18,796, 99% of the UK average. Negative GVA growth locally, coupled with healthy growth nationally, have quickly eroded Cheltenham’s previous strength on this measure compared to the national average.
• The majority of Cheltenham’s GVA is generated from within four main sectors:
* Distribution/Hotels & Catering (including Retail)
* Public Services
* Financial & Business Services
* Manufacturing
• Three of these major sectors have experienced a decline in GVA between 2005 and 2006, with only Financial & Business Services seeing continued growth.
• Average earnings in Cheltenham are higher than the national average (with an average gross weekly wage of £487 in 2007) and have generally increased in line with national trends between 2002 and 2007.
• There were approximately 56,300 employees in employment in Cheltenham in 2006, almost 10% fewer than in 2002, when employment had peaked at over 62,000 after several years of uninterrupted growth. The only other area of Gloucester to experience declining employment was the Forest of Dean.
• The decline locally has been driven by the loss of full-time jobs, while part-time employment has continued to grow.
• The recent falls in the number of jobs available locally has seen a corresponding fall in jobs density from X to X. In Cheltenham, there were 0.93 jobs per working age resident in 2005, still above the UK average of 0.84.
• At the time of the 2001 Census, there were approximately 6,500 self-employed people in Cheltenham.
• The majority of Cheltenham’s employment is contained within the same four main sectors as GVA.
• The largest individual sector of employment is Distribution/Hotels & Catering, which includes retailing, the majority of employment that is related to tourism and also the restaurants, bars and clubs that contribute much to the night-time economy.
• Over the last year, Cheltenham has seen growth in Construction, Financial & Business Services and Other Services. However, the agricultural and manufacturing sectors have continued their longer-term trend of decline, and Distribution/Hotels & Catering - the borough’s largest employment sector - has also declined. In Cheltenham This sector as a whole has seen a decline of 6.5% (around 1,100 jobs), driven by job losses in retailing.
• The retail sector in Cheltenham accounted for £227 million of GVA in 2006 (11% of total GVA), and employs more than 8,000 people. Cheltenham’s position in the latest CACI retail footprint rankings has fallen both regionally and nationally.
• The retail sector is also susceptible to external economic influences such as rising interest rates. Eight rate rises in recent years have had an impact on average disposable income, which in turn has caused difficulties for retailers on the high street. Experts predict further difficulties for the sector over the next two years, which are forecast to lead to further job losses.
• More than 50% of people working in Cheltenham are employed in higher level occupations, a higher proportion than both Gloucester and for Great Britain as a whole.
The Labour Force
• 62% of Cheltenham pupils achieved 5 or more GCSEs at grades A-C, comparable with the national average but slightly below the level achieved in Gloucester. Although this proportion has been increasing over the decade, the rate of improvement has been slower in Cheltenham compared to the national average.
• The proportion of 16 and 17 years olds participating in full-time education is higher than is the case nationally. However, there is a significant drop in participation between the ages of 16 and 17.- don’t get this?
• The number of young people aged 18-20 from Cheltenham who have gone on to higher education has increased by nearly 20% in the last six years.
• Unemployment rates in Cheltenham have remained low over the last seven years and are consistently below the national average. Although there was an increase during 2006, the unemployment rate has fallen again through 2007, towards the very low level experienced up to 2005.
• A higher proportion of Cheltenham’s unemployed claimants have been unemployed for more than six months, suggesting a degree of structural employment(define). However, the number of long-term unemployed claimants was falling during 2007.
• Economic activity rates are also higher than nationally, with a high proportion of the working age population (80%) available to work.
• Relative to some other major world economies, the UK does lag behind in terms of level 2 and 3 qualifications. However, qualification levels – a good proxy measure for workforce skills – are relatively high in Cheltenham, with more than a third of the working age population qualified to degree level or higher.
• Latest available NESS data suggests that the labour market has been tightening in recent years, with falling levels of vacancies. Skill shortage vacancies still exist in significant numbers, but employers are having less difficulty filling vacancies that were hard to fill for other reasons, almost certainly assisted by rising numbers of migrant workers. The average number of days training per employee has also been rising, which has seen the number of employees who are not fully proficient in their jobs fall by more than 40% in just two years.
Social Exclusion & Deprivation
• In the Index of Multiple Deprivation for 2007, both Cheltenham and Gloucester have risen up the rankings compared to their 2004 positions.
• Although Gloucester is clearly the most deprived district in Gloucester, there are some severe pockets of deprivation in Cheltenham, particularly parts of the wards of St Paul's, St Mark's, Hesters Way and Oakley.
• More than 10% of Cheltenham’s working age population were claiming at least one benefit at the end of 2007, slightly higher than in 2001.
• The number of claimants of key ‘out of work’ benefits has not changed significantly between 2001 and 2007, despite being a Government priority.
1. Introduction
1.1 Context
This report has been commissioned by Cheltenham Borough Council to analyse various aspects of its recent development and economic performance, and gain improved knowledge and evidence upon which to base decisions for targeting efforts to improve local economic performance.
With the imminent development of a joint Local Development Framework (LDF) between Cheltenham and Gloucester, which will lead to closer joint working and planning, also creates a need for a greater understanding of the economies of the two areas. Therefore, where possible data is presented here for both Cheltenham and Gloucester, to examine the differences between the two as well as their relative position to the nation as a whole.
1.2 Structure of the Report
This report brings together a wide range of official and previously unpublished data to develop a fairly comprehensive picture of recent trends within the local economy and labour market.
The report is structured as follows:
Section 2 - Population, Migration and Housing
Section 3 - The Economy
Section 4 - The Labour Force
Section 5 - Social Exclusion & Deprivation
2. Population, Migration and Housing
2.1 Population
Cheltenham's residential population was estimated to be 111,500 in 2006, similar in size to Gloucester. Between 2002 and 2006 the Borough’s population grew by 1.5%, the slowest rate within Gloucestershire and just half the rate for the South West as a whole, as shown in Table 2.1. This has almost certainly been influenced by restrictions on the availability of land for housing development within the borough’s boundaries, which has led to lower numbers of new housing completions compared to other areas.
Table 2.1: Population Change 2002-2006
|Area |2002 |2006 |Change 2002-2006 |% change 2002-2006 |
|England |49,652,300 |50,762,900 |1,110,600 |2.2% |
|South West |4,973,400 |5,124,100 |150,700 |3.0% |
|Cheltenham |109,800 |111,500 |1,700 |1.5% |
|Cotswold |80,500 |83,200 |2,700 |3.4% |
|Forest of Dean |80,000 |81,700 |1,700 |2.1% |
|Gloucester |110,200 |113,200 |3,000 |2.7% |
|Stroud |108,100 |110,300 |2,200 |2.0% |
|Tewkesbury |77,100 |78,800 |1,700 |2.2% |
Source: Mid-year Population Estimates (NOMIS)
The recently observed trend of slow population growth in Cheltenham is projected to continue over the next two decades, with the total population forecast to reach 116,300 by 2029. However, by contrast, the population of Gloucester is expected to grow more rapidly over the same period to around 123,500, which would see it emerge as the clearly dominant settlement in the county (see Figure 2.1).
Figure 2.1: Forecast Population Change 2004-2029
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Source: National Statistics, Sub-national Population Projections (2004-2029)
Within the context of overall population growth over the next two decades, official projections suggest some significant shifts in the balance of the population. Figure 2.2 shows that Cheltenham already has a generally older population compared to nationally, with a lower proportion of 0-14 year olds, and a higher proportion of people of pensionable age, particularly those over the age of 75.
Figure 2.2: Population by Age 2006
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Source: Mid-year Population Estimates (NOMIS)
Figure 2.3 shows how the structure of the population is likely to change up to 2029. It can be seen that both Cheltenham and Gloucester are forecast to experience falling birth rates which will see falling numbers of young people in both areas. The main areas of increasing population are forecast to be among the over 50s, as life expectancy levels continue to increase. The number of people age 65 and over living in Cheltenham is expected to rise by more than 40% in this time (and by over 60% in Gloucester), and the proportion of the population accounted for by this age group will rise from 17% in 2004 to over 23% in 2029.
Figure 2.3: Forecast Population Change by Age 2004-2029
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Source: National Statistics, Sub-national Population Projections (2004-2029)do we stay level on 25-34 yrs?
The official projections are based on recent trends, along with known data on birth rates and life expectancy levels, and represent what will happen based on those current trends. Therefore they do not take into account any potential changes in local land use policy that may free up additional sites for housing development and facilitate a faster rate of population growth in future years (see section 2.3.1)
2.2 Migration
With falling birth rates in the UK in recent decades, population growth has generally been driven by inward migration. Unfortunately, official datasets on migration between different localities of the UK have been withdrawn due to serious concerns about their accuracy.
Much recent discussion and debate has focussed on the impact of migrant workers coming into the UK. While foreign workers coming to this country is nothing new, there has been something of an explosion in the number of migrant workers arriving following the expansion of the EU in 2004.
Available data sources on migrant workers are not comprehensive, and only allow an indicative picture to be developed on the scale and impact of migrant working. The best indicator of inflows of migrant workers is the number of National Insurance Number registrations (NINos). Figure 2.4 shows that the number of non-UK NINos increased steeply in both Cheltenham and Gloucester following EU expansion in 2004, with Cheltenham attracting marginally more migrant workers than Gloucester.
Table 2.2 shows that Cheltenham and Gloucester are the main destinations within Gloucestershire for migrant workers, accounting for over 60% of the total in 2006/07. The same is true across the South West, with the region’s urban areas attracting the majority of migrant workers, perhaps unsurprising given the greater supply of housing and easier access to services.
In terms of where migrant workers come from, Poland has proved to be by far the most popular country of origin for workers coming into Cheltenham. The migrants are predominantly young (under 34) and almost two-thirds (62%) are male. A recent report by Gloucestershire County Council estimates of the number of dependants living with migrant workers in the County to be more than 900 young children (under 17) and 850 dependants over 17. These dependants now living in the county are not accounted for in official statistics, but may well require public services such as education and health. These numbers are likely to be boosted by other family members who are currently still overseas but who plan to join the migrant workers at some point in the future.
Figure 2.4: Non-UK NINo registrations in Cheltenham and Gloucester, 2002/03 to 2006/07
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Source: NINo Registration Data
Following the swift growth in the number migrant workers coming in to the area, there are indications that the growth rate of new NINo registrations is slowing down. As shown in Table 2.2, the number of new NINo registrations grew much slower across the UK between 2005/06 and 2006/07 compared to the previous year.
Table 2.2: Non-UK NINo registrations, 2004/05 to 2006/07, Gloucestershire, South West and UK
|Area |2004/05 |2005/06 |2006/07 |% change 04/05-05/06 |% change 05/06-06/07 |
|Great Britain |439,730 |662,390 |713,450 |50.6% |7.7% |
|South West |22,570 |33,720 |41,730 |49.4% |23.8% |
| | | | | | |
|Cheltenham |820 |1,350 |1,440 |64.6% |6.7% |
|Cotswold |380 |520 |610 |36.8% |17.3% |
|Forest of Dean |140 |240 |250 |71.4% |4.2% |
|Gloucester |610 |1,150 |1,260 |88.5% |9.6% |
|Stroud |300 |430 |460 |43.3% |7.0% |
|Tewkesbury |210 |310 |370 |47.6% |19.4% |
Source: NINo Registration Data
More detailed reports on all aspects of migrant working have recently been published by both Gloucestershire County Council and the Skills and Learning Module (SLIM) of the South West Regional Observatory (see references section for download details).
2.3 Self-containment and commuting
At the time of the 2001 Census of Population, approximately 70% of employed people living in Cheltenham also worked in the town, suggesting a reasonable level of self-containment in the local labour market. However, at the same time, there were around 22,300 people each day travelling into Cheltenham to work from outside the borough. Is this the most up to date data
The majority of these (18,400, around 83%) commute by car into the town, suggesting a significant strain on existing road capacity. Data held by the Borough Council shows that average traffic flows on several of the major routes into Cheltenham has consistently increased since the time of the Census, with the following increases since 2001/02: (good inclusion)
Tewkesbury Road 4.6%
Evesham Road 28.2%
London Road 4.7%
Gloucester Road 47.5%
Alongside the increasing traffic flows on the major roads into Cheltenham, the number of park and ride tickets sold has also increased significantly in recent years, by over 20% in the last year alone. Although, park and ride clearly plays an important role in reducing traffic congestion in the town, it is impossible to accurately measure of its impact at peak times as the available data doesn’t allow any breakdown by type of trip e.g. commute to work, or travelling into Cheltenham for shopping / leisure.
2.4 Future Development
2.4.1 Development Strategy
The fairly rapid growth in the population of the South West (as shown in section 2.1), has increased demand for housing. High demand has in turn inflated house prices resulting in such a gap between earnings and house prices that many households cannot afford to own their own home (discussed further in section 2.3.2). The state of the housing market impacts on the ability to create and maintain sustainable, balanced communities, and affects the retention and recruitment of key workers. The Barker report has responded by concluding that providing affordable housing will only be achieved through increasing the supply of new housing nationally.
According to the South West Regional Spatial Strategy (RSS):
‘The demand for affordable housing, and the buoyant economy of the region suggest a need to increase and accelerate the provision of housing over the lifetime of the RSS, to provide an adequate choice and mix of housing of all tenures, across the region, concentrated at the most sustainable locations. 25,000 new dwellings per annum will be needed to meet the scale of need arising from economic growth, to respond to the under supply in the current market and to address the issues of affordable housing across the region.’
Current planning guidance (RPG10) established the strategy of existing centres being the best locations for accommodating large scale change. This is translated in the RSS by the identification of 21 settlements which by their role and function will sustainably deliver the strategy and encourage a balance between jobs and homes (Strategically Significant Cities and Towns = SSTCs).
The RSS identifies Cheltenham and Gloucester as SSTCs which contribute to the success of the regional economy, with a wider influence than just within the context of Gloucestershire. The focus of RSS is economy led, and taking into account the currently limited capacity of the urban areas to accommodate further growth, provision is made for removal of part of the Green Belt to make provision for planned strategic urban extensions.
Policies SR3.3 and SR3.4 set a requirement for Gloucester to develop:
• 1,050 dwellings per annum (21,500 over the plan period to 2026) – including a strategic urban extension of 2,500 north of Gloucester wholly within Tewkesbury, 11,500 within the existing urban area, remaining 7,000 made up of existing commitments south and east of Gloucester in Stroud and Tewkesbury
• 12,750 jobs within the Gloucester travel to work area
These policies set a requirement for Cheltenham to develop:
• 690 dwellings per annum (13,800 over the plan period to 2026) – including a strategic urban extension of 5,000 north of Cheltenham (partly within Cheltenham’s administrative area, partly in Tewkesbury), 6,500 within the urban area, 1,300 to the south of Cheltenham (partly in Tewkesbury), and 1,000 to the north of Bishop’s Cleeve
• 10,750 jobs within the Cheltenham travel to work area
2.4.2 House Prices
Table 2.3 shows that the average house price in Gloucestershire was just over £196,000 at the end of 2007, almost double the average of 2001. Average house prices in recent years have consistently increased, albeit at a slower rate since 2005, with Gloucestershire generally following the wider regional and national trends.
Table 2.3: Growth in Average House Prices, Gloucestershire, South West and England & Wales, 2001-2007
|Year |Average House Price |Annual Change (%) |
| |Gloucestershire |Gloucestershire |South West |England & Wales |
|2001 |108,378 |13.4% |16.0% |13.0% |
|2002 |133,162 |22.9% |26.5% |23.1% |
|2003 |148,947 |11.9% |11.4% |13.6% |
|2004 |167,840 |12.7% |11.6% |13.5% |
|2005 |170,926 |1.8% |2.2% |2.8% |
|2006 |183,579 |7.4% |7.5% |7.7% |
|2007 |196,071 |6.8% |6.0% |6.7% |
Source: UK Land Registry
Note: Data is for December of each year
However, despite the recent slowdown in house price growth, increases have still outstripped the growth in average wages, resulting in consistently falling levels of affordability for Cheltenham and Gloucester, in line with the regional and national trend, as shown in Figure 2.5. The graph also suggests that affordability is slightly higher in Cheltenham, as a result of higher average wages (see section 3.??).
Figure 2.5: House Price Affordability, 2002-2007
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Source: UK Land Registry and ASHE 2002-2007
Note: Affordability is expressed as average annual wage / average house price.
Average house price for Gloucestershire is used for both Cheltenham and Gloucester.
2.5 Summary
This section has looked at issues around population change, migration and housing. The key issues emerging for Cheltenham are as follows:
• Cheltenham’s population has grown significantly slower than Gloucester, the surrounding county and regional and national averages, constrained by the lack of development land for housing.
• This slow growth is forecast to carry on over the next two decades, which would result in Gloucester becoming a significantly larger settlement than Cheltenham.
• Significant changes to the structure of the population are also forecast, with declining numbers of young people and huge increases in the numbers of people aged over 65. Although it is following the broad national trend of an ageing population, the implication for Cheltenham is that limited overall population growth and falling numbers of young people will result in negligible growth in the labour force. This could then restrict the ability of Cheltenham’s economy to grow without increased levels of inward commuting, placing further strain on an already congested road network.
• There has been a huge increase in the numbers of migrant workers coming into Cheltenham and Gloucester since the expansion of the EU in 2004. Although there is limited evidence regarding how long migrant workers actually stay in the UK, the number of new NINo registrations is around 1,400 per year in Cheltenham.
• Increases in house prices have far outstripped growth in average wages, resulting in consistently falling affordability in recent years.
• The planned urban extensions outlined in the RSS will be crucial for enabling future economic growth in Cheltenham, and avoiding the realisation of the current demographic forecast, which is based on the current lack of available development land. It should be emphasised that the planned urban extensions are NOT factored into the population forecasts.- we need to have a chat re this
3. The Economy
3.1 Global Economic Issues
Local economies are significantly influenced by the global, national and regional economies that they operate within, with economic decisions increasingly being taken outside the area that may be most affected by those decisions. The rise of modern technology has afforded businesses the ability to market products and services all over the globe. It has also allowed them to develop partnerships and alliances throughout the world, which have become essential for success. The breaking down of global barriers allows companies to benefit from the largest and cheapest workforces, raw materials, and technology.
This recent process of globalisation has seen the US share of the global economy shrink to approximately 25%, a trend that is expected to continue as the economies of many newly industrialized countries continue to grow at a faster rate. Certainly the UK has also felt the impact of globalisation, with the significant decline of the manufacturing sector as decisions are made to switch production to lower cost economies (the extent of the decline in Cheltenham is discussed in section 3.?), and also the transfer of service sector call centres to locations such as India. Another example is the current ‘credit crunch’, with its origins in the US sub-prime lending market, which is developing into a wider financial crisis. The bank Bear Stearns has collapsed and the US Federal Reserve has slashed interest rates in an attempt to restore confidence to financial markets. The US economy is facing a recession, and the UK along with the rest of the world may soon enter a downturn.
Another global issue that will have economic consequences is that of climate change. The Stern Review on the ‘Economics of Climate Change’ was produced in October 2006 by the economist Lord Nicholas Stern for the UK government, which discusses the effect of climate change and global warming on the world economy. Its main conclusions are that 1% of global Gross Domestic Product (GDP) per annum is required to be invested in order to avoid the worst effects of climate change, and that failure to do so could risk global GDP being up to 20% lower than it otherwise might be.
Applying this worst-case scenario to the Cheltenham economy, based on the data derived from the local GVA model (discussed in section 3.2 below), this could see local economic output decline by £420 million from its 2006 position, with the potential of over 11,000 jobs being lost. Climate change is clearly an issue that cannot be ignored, and the Borough Council will have a significant role to play in helping limit its effects locally.
3.2 Local Economic Trends - GVA
It has been possible to measure local economic output using the ‘Local GVA Model’ (see explanatory note below). Using this model, the total value of goods and services produced in Cheltenham was estimated to be £2,096 million in 2006. Although this represents a slight increase of 0.2% (£5 million) from 2005, output has fallen since its peak of in £2,451m 2003. The decline in overall levels of GVA during 2004 and 2005 were driven by employment decline in some sectors – discussed in more detail in section 3.4.4.
| |
|The Local GVA model |
|The Local GVA Model was created by the ex-Treasury economist Owen Nankivell, in response to a need for Local Authority level economic |
|information. The model is based on the methodology of the National Accounts and Input-Output Annual Supply and Use Tables used by the ONS|
|to estimate GDP/GVA. It works at a lower level of geography than currently provided by the ONS and provides a far greater amount of |
|industry specific information than is currently available from the ONS at NUTS 3 level. |
| |
|It makes use of as much local data as possible, where data is not available locally, the model applies a local ‘factor’ to national level|
|information or uses national input-output ratios between National Accounts components in order to extrapolate at a local level. |
| |
|The model can be used to identify a local economies strengths and weaknesses, in addition to areas of growth and decline. The insights |
|provided can be used to feed into local level economic policy in order to improve the productivity and prosperity of an economic area. |
Figure 3.1: Cheltenham GVA at Basic Prices, 1994-2006 (£ million)
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Source: Cheltenham GVA Model
3.2.1 GVA per head
In 2006, Cheltenham’s GDP per head was £18,796, 99% of the national average. As can be seen Table 3.1, this is quite a sharp decline from 2002, when it was 136% of the national average. This fall has been caused by the decline in the overall amount of GVA produced in the area, coupled with an increasing population, as described in section 2.1.
Table 3.1: GVA Per Head - Cheltenham compared to National 2001-2006 (£)
|Area |
|1 |Agriculture & Forestry/Fishing |
|2 |Mining & Quarrying/Elec., Gas & Water |
|3 |Manufacturing |
|4 |Construction |
|5 |Distribution/Hotels & Catering (includes retail & tourism-related employment) |
|6 |Transport & Communications |
|7 |Financial & Business Services |
|8 |Public Services |
Figure 3.3 shows how levels of GVA within each sector have changed over the last year. It can be seen that of Cheltenham’s four main sectors, three experienced a decline, with only Financial & Business Services seeing an increase (of 8.8%). The other sectors declined as follows:
• Manufacturing -5.7%
• Distribution/Hotels & Catering -7.2%
• Public Services -3.3%
In percentage terms, the largest increase in GVA was in the Energy & Water sector. However, being such a minor sector in the Cheltenham economy, the net effect on overall GVA is minimal. Some of Cheltenham’s other smaller sectors (Construction, Transport & Communications) experienced reasonable GVA growth between 2005 and 2006.
Figure 3.3: Change in GVA by Output Sector 2005-2006 (%)
[pic]
Source: Cheltenham GVA Model
|Key |
|1 |Agriculture & Forestry/Fishing |
|2 |Mining & Quarrying/Elec., Gas & Water |
|3 |Manufacturing |
|4 |Construction |
|5 |Distribution/Hotels & Catering (includes retail & tourism-related employment) |
|6 |Transport & Communications |
|7 |Financial & Business Services |
|8 |Public Services |
|9 |Total GVA |
3.3 Earnings
Average earnings in Cheltenham are higher than the national average, with an average gross weekly wage of £487 in 2007 (compared to £407 in Gloucester and £459 for Great Britain as a whole). As shown in Figure 3.4, average gross weekly pay has generally increased in line with national trends between 2002 and 2007.
Figure 3.4: Average Gross Weekly Pay, Cheltenham and Gloucester compared with GB, 2002-2007
[pic]
Source: ASHE 2002-2007 via Nomis
3.4 Employment and Industrial Structure
3.4.1 Employment trends
According to the Annual Business Inquiry, there were an estimated 56,300 employees in employment in Cheltenham. This represents a decline of more than 6,000 (almost 10%) from 2002, when employment had peaked at over 62,000 after several years of uninterrupted growth. The recent decline in overall employment in Cheltenham has seen Gloucester emerge as the largest centre of employment in Gloucestershire. A more detailed sectoral analysis is included in section 3.4.4 below.
Table 3.2: Employment change in Gloucestershire, South West and Great Britain, 2002-2006 (Total Employees)
|Area |2002 |2005 |2006 |Change 2002-2006 |% change 2002-2006 |
|Cheltenham |62,400 |55,900 |56,300 |-6,100 |-9.8% |
|Cotswold |31,800 |36,100 |36,200 |4,400 |13.8% |
|Forest of Dean |24,200 |21,900 |22,900 |-1,300 |-5.4% |
|Gloucester |59,500 |63,500 |63,600 |4,100 |6.9% |
|Stroud |39,200 |42,100 |42,500 |3,300 |8.4% |
|Tewkesbury |33,400 |34,800 |34,300 |900 |2.7% |
|Gloucestershire |250,600 |254,200 |255,800 |5,200 |2.1% |
|South West |2,123,400 |2,211,700 |2,211,100 |87,700 |4.1% |
|Great Britain |25,593,700 |26,496,600 |26,320,600 |726,800 |2.8% |
Source: Annual Business Inquiry 2002-2006 via Nomis
Table 3.3 shows that 63% of employees in Cheltenham are full-time (a similar breakdown is evident in Gloucester), somewhat below the national average of 69%. Both Cheltenham and Gloucester have seen growth in part-time employment that has outstripped growth in full-time employment, in contrast to the national trend. This suggests that Cheltenham and Gloucester are becoming more dependent on part-time employment opportunities to sustain growth.
Table 3.3: Employment change in Cheltenham, Gloucester and Great Britain, 2002-2006 (Full and Part Time Employees)
|Area |Full / Part time |2002 |2006 |Change |% change 2002-2006 |
|Cheltenham |Full time |41,900 |35,400 |-6,500 |-15.6% |
| |Part time |20,500 |20,900 |400 |1.9% |
| |Total |62,400 |56,300 |-6,100 |-9.8% |
|Gloucester |Full time |38,700 |39,600 |900 |2.3% |
| |Part time |20,800 |24,000 |3,200 |15.4% |
| |Total |59,500 |63,600 |4,100 |6.9% |
|GB |Full time |17,516,200 |18,123,200 |607,100 |3.5% |
| |Part time |8,077,500 |8,197,300 |119,800 |1.5% |
| |Total |25,593,700 |26,320,600 |726,900 |2.8% |
Source: Annual Business Inquiry 2002-2006 via Nomis
3.4.2 Jobs Density
This jobs density indicator is defined as the number of filled jobs in an area divided by the working-age population resident in that area. This shows the extent to which the area could generate enough employment for its working age population (if all of the latter chose to look for work, and there were no commuting into or out of the area).
A healthy labour market would be one in which there are sufficient job opportunities for the resident working age population. In Cheltenham, there were 0.93 jobs per working age resident (1.0 in Gloucester), above the UK average of 0.84 jobs per working age resident. However, while the UK figure has remained steady in recent years, the ratio in Cheltenham has been falling consistently since 2002, as growth in the working age population has outstripped any employment growth in the area (see Figure 3.5).
Figure 3.5: Jobs Density, Cheltenham and Gloucester compared with GB, 2000-2005
[pic]
Source: Nomis
3.4.3 Levels of self-employment
The Census of Population is the most accurate measure of self-employment that can be used, but occurs only once every ten years. The 2001 Census showed that there were just over 6,500 self-employed people in Cheltenham, an increase of 25% from the time of the 1991 census. The most common industries of self-employed people are as follows:
• Construction 17.8%
• Distribution, Hotels & Catering 18.5%
• Financial & Business Services 24.5%
• Education, Social Work, Health, Public Administration 21.5%
3.4.4 Industrial Structure
The majority of Cheltenham’s employment is contained within four main sectors as shown in Figure 3.6. They are:
• Distribution/Hotels & Catering
• Public Services
• Financial & Business Services
• Manufacturing
The largest individual sector of employment is Distribution/Hotels & Catering, which is perhaps unsurprising, as it includes retailing, the majority of employment that is related to tourism and also the restaurants, bars and clubs that contribute much to the night-time economy. Figure 3.6 shows this sector accounts for a higher proportion of employment than either Gloucester or Great Britain as a whole, reflecting the relative strength of Cheltenham’s retail, tourism and night-time economy sectors.
Figure 3.6: Distribution of employees by broad industrial sector, Cheltenham, Gloucester and Great Britain, 2006
[pic]
Source: Annual Business Inquiry 2006 via Nomis
|Key |
|1 |Agriculture & Forestry/Fishing |
|2 |Mining & Quarrying/Elec., Gas & Water |
|3 |Manufacturing |
|4 |Construction |
|5 |Distribution/Hotels & Catering (includes retail & tourism-related employment) |
|6 |Transport & Communications |
|7 |Financial & Business Services |
|8 |Public Services |
|9 |Other Services |
Figure 3.7 details how employment has changed over the last year. It shows some mixed fortunes for Cheltenham, with growth in Construction, Financial & Business Services and Other Services. However, the agricultural and manufacturing sectors have continued their longer-term trend of decline, and Distribution/Hotels & Catering - the borough’s largest employment sector - has also declined. This sector as a whole has seen a decline of 6.5% (around 1,100 jobs), driven by job losses in retailing (over 800 jobs). The issues affecting the retail sector are discussed in some more detail in section 3.5.
Figure 3.7: Employment change by broad industrial sector, Cheltenham, Gloucester and Great Britain, 2005-2006 (% change)
[pic]
Source: Annual Business Inquiry 2006 via Nomis
|Key |
|1 |Agriculture & Forestry/Fishing |
|2 |Mining & Quarrying/Elec., Gas & Water |
|3 |Manufacturing |
|4 |Construction |
|5 |Distribution/Hotels & Catering (includes retail & tourism-related employment) |
|6 |Transport & Communications |
|7 |Financial & Business Services |
|8 |Public Services |
|9 |Other Services |
|Note regarding Official Employment Data |
| |
|In the process of updating the local GVA model for 2005 and 2006, official employment estimates by sector for Cheltenham, suggested that |
|the hotels and catering sector had declined by almost 40% (2,000 or so employees) between 2005 and 2006. Further investigation into the |
|revealed that the figures for Cheltenham Racecourse were missing in 2006. |
| |
|Therefore, a process of data ‘smoothing’ was required, whereby 2005 figures for employment at the racecourse were added into the total |
|for 2006. As a result, the data presented in this report will differ slightly from the official results generated by the Annual Business |
|Inquiry. |
3.4.5 Employment by Occupation
Table 3.4 shows that Cheltenham's occupational structure has a generally higher level of skilled occupations than for Great Britain as a whole. Cheltenham has a higher level of managerial, professional, associate professional and technical jobs. Correspondingly, it has a lower percentage of people working in process, plant and machine operatives and elementary occupations, which are generally the lowest skilled.
Table 3.4: Occupational Structure, Cheltenham, Gloucester and Great Britain, 2007
|Occupation |Cheltenham |Gloucester |Great Britain |
| |No. |% |No. |% |% |
|Managers and senior officials |9,100 |15.6 |9,900 |17.1 |15.2 |
|Professional occupations |10,200 |17.5 |6,400 |11.1 |13.0 |
|Associate prof & tech occupations |10,400 |17.7 |7,700 |13.4 |14.3 |
|Administrative and secretarial occupations |7,000 |12.0 |7,000 |12.1 |12.0 |
|Skilled trades occupations |6,600 |11.3 |7,600 |13.2 |10.9 |
|Personal service occupations |3,700 |6.3 |5,600 |9.7 |8.1 |
|Sales and customer service occupations |5,200 |8.9 |4,000 |7.0 |7.7 |
|Process, plant and machine operatives |1,900 |3.3 |3,600 |6.3 |7.2 |
|Elementary occupations |4,300 |7.3 |5,700 |10.0 |11.4 |
Source: Annual Population Survey, Apr-Jun 2007
3.5 Key and Emerging Sectors
In general terms, the same four sectors account for the majority of both employment and GVA, namely:
• Distribution/Hotels & Catering
• Public Services
• Financial & Business Services
• Manufacturing
These four broad sectors are therefore of most importance to the overall economic well-being of Cheltenham. However, within these broad headings there are some key sub-sectors that are of particular importance. Within the public services sector there are some large employers, such as GCHQ, Cheltenham Borough Council and the local Primary Care Trust.
Within the largest overall sector - Distribution/Hotels & Catering - the sectors of retail and tourism are major contributors to economic output.
The Retail Sector
The retail sector in Cheltenham accounted for £227 million of GVA in 2006 (11% of total GVA), and employs more than 8,000 people. According to the latest CACI retail footprint (see note below), Cheltenham’s ranking in the league table of retail centres fell from 30th to 36th nationally, and from 2nd to 4th regionally.
|Retail Footprint |
|Retail Footprint is CACI's unique model of retail centre potential. It classifies every UK centre into one of 40 different Centre |
|Classes. The retail provision in each centre is broken down into premium, mass and value. This allows each centre to be scored relative |
|to one another on the basis of both the quality and quantity of provision. The Retail Footprint database summarises all this information |
|as well as the potential expenditure for each centre. |
| |
|Source: caci.co.uk |
The retail sector and the jobs within it are very susceptible to external influences such as economic and consumer trends. For example, changes in interest rates, for example, will affect people’s disposable income and how much, therefore, they are likely to spend. Customer confidence is a key issue: if people feel optimistic about their own and the wider economic circumstances, they are likely to spend more.
Rising interest rates in the UK go a long way to explaining the recent fall in retail employment and output in recent years. From a low point of 3.5% in November 2003, there were 10 rate increases by the Bank of England up to July 2007. Recent interest rate falls – implemented by the Bank of England in response to the global credit crunch and to stave off concerns about the UK entering a recession – may offer some respite to the high street.
However, a recent article in the Daily Telegraph highlights concerns for further job losses in the sector over the next two years. Richard Hyman of Verdict Consulting -one of the UK's most respected retail-watchers – estimates, following disappointing Christmas sales for a number of retailers, that 100,000 jobs will be lost from the sector in 2008/09, and is quoted as saying:
The prediction from Richard Hyman, the managing director of Verdict Consulting and one of the UK's most respected retail-watchers, follows a disappointing Christmas trading period for a number of retailers including Marks & Spencer.
‘In all likelihood there will be an acceleration in job losses. Cost growth at the retailers has been outstripping sales growth and I expect this gap to widen in 2008’
Another threat to traditional high street shopping is the rise of e-commerce in recent years. Although the dot com bubble has long since burst with the collapse of a number of online retailers, online continues to grow. Recent figures published in the media estimate that online shopping now accounts for 15% of all retail spending, with a total of around £40 billion spent online by UK consumers in the last year alone.
Research has indicated that UK consumers are much more likely to buy from the website of a "household name" retailer rather than an e-commerce site without a physical presence in the shopping centre, even if they knew and trusted it. The results of one survey strongly reflect that consumers continue to need brand reassurance when making a purchase online.
Despite this reassurance from consumer attitudes, there has been much criticism in the media of both the speed and quality of high street retailers’ response to e-commerce. Research by Web Credible into the quality of leading high street brands’ websites showed that the average score for an online shopper’s experience was just 57%, leading to the conclusion that
‘it is quite clear that the UK’s leading high street shops will be missing out on a £7 billion bounty. With their competitors just a click away, users are unlikely to hand around for long on an unusable website. Quite simply, if online shoppers can’t use a website, they can’t (and won’t) buy the products they want to buy.’
Source: Web Credible, 2006
There is further evidence to suggest that retailers are not doing all they should be in order to counter the threats to posed by e-commerce. Limited product offerings and poor customer service in the high street are increasing online shopping in the UK, according to research by Accenture. Their recent survey found that 55% of UK consumers polled felt that shops did not have enough tills open, while 49% said the products they want are often out of stock.
‘Retailers know that issues such as poor customer service and out-of-stock products frustrate their customers. But what is shocking is that only a small number of successful retailers translate this customer insight into meaningful operational customer service improvements across their retail and product channels.’
Accenture UK
As well as established sectors, it is also important to take into account sectors of emerging importance. Two such sectors are Creative Industries and Environmental Technologies, both of which are discussed below.
3.5.1 Creative Industries
The Creative Industries is one that is growing in importance, accounting for 7.3% of UK Gross Value Added (GVA) in 2004. Nationally, the sector grew by an average of 5% per annum between 1997 and 2004, compared to an average of 3% for the economy as a whole.
The official definition of Creative Industries (as adopted by the Department for Culture, Media and Sports) brings together a wide range of activities, as listed below:
• Advertising
• Architecture
• Art & Antiques
• Designer Fashion
• Video, Film & Photography
• Music & Visual Performing Arts
• Publishing
• Software, Computer Games & Electronic Publishing
• Radio & TV
Using this definition, Table 3.5 shows how Creative Industries is rising in importance to the Cheltenham economy, with a 6% growth in employment between 2003 and 2006, increasing at a similar rate to the national trend. Creative industries employment is less prevalent in Gloucester, and has grown at a slower rate.
Table 3.5: Employment in Creative Industries in Cheltenham, Gloucester and Great Britain, 2003-2006
|Area |2003 |2006 |Change 2003-2006 |% change 2003-2006|
|Cheltenham |CI employees |5,000 |5,300 |300 |6% |
| |% of total employees |8.1% |9.7% |- |- |
|Gloucester |CI employees |3,300 |3,400 |100 |3% |
| |% of all employees |5.1% |5.4% |- |- |
|GB |CI employees |1,877,600 |1,993,700 |116,100 |6% |
| |% of all employees |7.3% |7.6% |- |- |
Source: Annual Business Inquiry 2003-2006 via Nomis
Figure 3.8 shows the structure of employment within Creative Industries in 2006. In Cheltenham it can be seen that just the following three sub-sectors account for around two thirds of the sector’s employment:
• Art & Antiques
• Designer Fashion
• Software, Computer Games & Electronic Publishing
Figure 3.8: Structure of Creative Industries Employment, Cheltenham, Gloucester and Great Britain, 2006
[pic]
Source: Annual Business Inquiry 2006 via Nomis
|Key |
|1 |Advertising |
|2 |Architecture |
|3 |Art & Antiques |
|4 |Designer Fashion |
|5 |Video, Film & Photography |
|6 |Music & Visual Performing Arts |
|7 |Publishing |
|8 |Software, Computer Games & Electronic Publishing |
|9 |Radio & TV |
3.5.2 Environmental Technologies
The emerging Environmental Technologies sector also covers a wide range of different activities, with the official definition including the following sub-sectors:
• Air Pollution Control
• Cleaner Technologies & Processes
• Decommissioning/Decontamination of Nuclear Sites
• Environmental Consultancy
• Environmental Monitoring, Instrumentation and Analysis
• Energy Management/Efficiency
• Marine Pollution Control
• Noise and Vibration Control
• Remediation and Reclamation of Land
• Renewable Energy
• Waste Management, Recovery and Recycling
• Water Supply and Wastewater Treatment
Applying this list of sub-sectors to the Standard Industrial Classification (SIC), Table 3.6 suggests that Environmental Technologies has a limited presence in both Cheltenham and Gloucester, with the sector accounting for a lower proportion of total employment than the national average. While employment levels have increased nationally, they have remained static in Gloucester and have actually fallen in Cheltenham.
Table 3.6: Employment in Environmental Technologies in Cheltenham, Gloucester and Great Britain, 2003-2006
|Area |2003 |2006 |Change 2003-2006 |% change 2003-2006|
|Cheltenham |Env Tech employees |800 |400 |-400 |-50% |
| |% of total employees |1.4% |0.8% | | |
|Gloucester |Env Tech employees |400 |400 |0 |0% |
| |% of all employees |0.7% |0.7% | | |
|GB |Env Tech employees |271,000 |292,800 |21,800 |8% |
| |% of all employees |1.1% |1.1% | | |
Source: Annual Business Inquiry 2003-2006 via Nomis
Figure 3.9 details the structure of Environmental Technologies employment in 2006. It shows that just two sub-sectors account for around 80% of all employment in the sector in Cheltenham:
• Manufacture of electricity distribution and control apparatus
• Sanitation, remediation and similar activities
Figure 3.9: Structure of Environmental Technologies Employment, Cheltenham, Gloucester and Great Britain, 2006
[pic]
Source: Annual Business Inquiry 2006 via Nomis
|Key |
|1 |Manufacture of non-domestic cooling and ventilation equipment |
|2 |Manufacture of electricity distribution and control apparatus |
|3 |Recycling of metal waste and scrap |
|4 |Recycling of non-metal waste and scrap |
|5 |Collection, purification and distribution of water |
|6 |Demolition and wrecking of buildings; earth moving |
|7 |Construction of water projects |
|8 |Insulation work activities |
|9 |Technical testing and analysis |
|10 |Collection and treatment of sewage |
|11 |Collection and treatment of other waste |
|12 |Sanitation, remediation and similar activities |
| | |
| |This key refers to SIC categories and is only a best fit against the official definition|
| |of sub-sectors listed above. |
3.6 Business Structure and Entrepreneurial activity
3.6.1 Sizeband Analysis
Another aspect of understanding the local economy is looking at the size of its employers and analysing the impact of large employers on overall employment levels.
Figure 3.10: Number of Businesses by sizeband, Cheltenham, Gloucester and Great Britain, 2006
[pic]
Source: Annual Business Inquiry 2006 via Nomis
Figures 3.10 and 3.11 show that Cheltenham has a higher proportion of its business stock and employment in small businesses compared to Gloucester and England as a whole. Some 85% of businesses in the area employ just 1-10 people, which account for 22% of all employees in employment. Gloucester, by contrast has a higher prevalence of medium-sized enterprises, which account for 5.7% of all businesses (more than twice the level in Cheltenham) and a third of all employees.
Figure 3.11: Number of Employees by sizeband, Cheltenham, Gloucester and Great Britain, 2006
[pic]
Source: Annual Business Inquiry 2006 via Nomis
3.6.2 VAT registrations / de-registrations
One aspect of a healthy labour market is the ability to renew itself by generating new businesses. The creation of new firms (or business generation) can by proxied by the rate of VAT registrations, while VAT-deregistrations can be used as a measure of business failure.
At the end of 2006, there were just over 4,000 VAT-registered businesses in Cheltenham, a figure significantly higher than in Gloucester. The last 5 years have seen positive growth in Cheltenham’s business stock, which has grown by 8% in this time, slightly below the national average but twice the rate in Gloucester.
Table 3.7: Stock of VAT registered businesses, Cheltenham, Gloucester and Great Britain, 2001-2006
|Area |2001 |2005 |2006 |Change 2001-2006 |% change 2001-2006 |
|Cheltenham |3,730 |3,920 |4,035 |305 |8.2% |
|Gloucester |2,540 |2,560 |2,645 |105 |4.1% |
|Great Britain |1,728,300 |1,853,660 |1,892,215 |163,915 |9.5% |
Source: VAT Registration Data, via Nomis
Figure 3.12 shows that Cheltenham has experienced consistent growth in its business stock over the last five years, with growth accelerating in the last two years to overtake the national average.
Figure 3.12: Change in the stock of VAT registered businesses, Cheltenham, Gloucester and Great Britain, 2001-2006 (year on year percentage change)
[pic]
Source: VAT Registration Data, via Nomis
Although the number of new businesses forming (registrations) has outstripped the number of businesses failing (deregistrations), there were still 300 VAT deregistrations in 2006. Figure 3.13 shows that deregistrations outnumbered new registrations in manufacturing and construction, while there was positive net growth in Wholesale, retail and repairs, Hotels and restaurants, and Real Estate, renting and business activities.
Figure 3.13: VAT registrations and deregistrations by industry, Cheltenham, 2006
[pic]
Source: VAT Registration Data, via Nomis
|Key |
|1 |Agriculture; Forestry and fishing (SIC A,B) |
|2 |Mining and quarrying; Electricity, gas and water supply (SIC C,E) |
|3 |Manufacturing (SIC D) |
|4 |Construction (SIC F) |
|5 |Wholesale, retail and repairs (SIC G) |
|6 |Hotels and restaurants (SIC H) |
|7 |Transport, storage and communication (SIC I) |
|8 |Financial intermediation (SIC J) |
|9 |Real Estate, renting and business activities (SIC K) |
|10 |Public administration; Other community, social and personal services (SIC L,O) |
|11 |Education; health and social work (SIC M,N) |
3.6.3 Business Survival rates
In terms of business survival rates, Cheltenham performs well in the short-term, with 93% of new businesses surviving their first year of trading. One year survival rates locally have increased from 90% in 1995. However, longer-term survival rates are not so encouraging, with just 69% of Cheltenham’s businesses surviving three years. Three year survival rates have shown no improvement in recent years, in Cheltenham, while they have risen significantly in Gloucester and across the country as a whole.
Table 3.8: One and Three Year Business Survival Rates, Cheltenham, Gloucester and England
|Area |1 yr survival rates |3 yr survival rates |
| |1995 |2004 |
| |1997 |2007 |
| |1999/2000 |2005/06 |
| |No. |(%) |No. |(%) |
|Cheltenham |285 |23.4% |490 |40.2% |
|Gloucester |385 |28.7% |430 |32.0% |
|Great Britain |236,150 |30.8% |230,070 |30.0% |
Source: Claimant Count via Nomis
Figure 4.3 shows how levels of youth and long-term unemployment in Cheltenham have changed in recent years. It shows that the general trend has been for increasing numbers of both groups between 2002 and 2006, with a significant reversal during 2007, suggesting increasing numbers of employment opportunities during that year.
Figure 4.3: Unemployment by Age & Duration, Cheltenham (no. of claimants) 2001- 2007
[pic]
Source: Claimant Count via Nomis
Note: data is for December of each year
4.3 Economic activity rates
Economic activity rates indicate the proportion of the local resident population who are active in the labour market i.e. in employment, on government training schemes and those who are unemployed and seeking employment. A high economic activity rate indicates a healthy labour market where a large proportion of the population are able to contribute to the local economy.
Figure 4.4 shows that economic activity rates in Cheltenham are higher than the national average, at around 80% of the working age population.
Figure 4.4: Economic Activity Rates, Cheltenham, Gloucester and England, 2004-2006
[pic]
Source: Annual Population Survey, 2004-2006
4.4 Qualifications of the workforce
Qualification levels can be used as a proxy measure for workforce skills. In international terms, Table 4.4 shows that the UK workforce lags behind all its main competitors in terms of level 2, with just 64% of the workforce qualified to level 2 and above. At level 3 and above, the UK performs better than Singapore and France, but still lags well behind the USA and even further behind Germany.
Table 4.4: Qualifications at Level 2, 3 and above, international comparison, 2003 (total workforce aged 16-64)
|Qualified to |UK |France |Germany |Singapore |USA |
|Level 2+ |64 |77 |85 |67 |73 |
|Level 3+ |44 |41 |68 |39 |57 |
Source: The Economy of Gloucestershire (GLMIU)
At a more local level, Figure 4.5 shows that Cheltenham’s workforce is generally better qualified than the national average, at all levels. This is particularly so at level 4 and above (graduate level), with 36% of the working age population qualified to this level compared to just 27% nationally.
Figure 4.5: Qualification levels of the workforce, Cheltenham, Gloucester and England, 2006
[pic]
Source: Annual Population Survey via Nomis
Key to Qualification Levels
|Level |Examples of Qualifications |
|5 |Level 5 NVQ, Level 5 Diploma, PhDs, Masters degrees, postgraduate certificates & diplomas |
|4 |Level 4 NVQ, Level 4 National Diploma, Level 4 BTEC Higher National Diploma, Bachelor degrees, Foundation |
| |degrees, HNDs |
|3 |Level 3 Certificate, Level 3 NVQ, A Levels |
|2 |Level 2 Diploma, Level 2 NVQ, GCSEs grades A*-C |
|1 |Level 1 Certificate, Level 1 NVQ, GCSEs |
Source: Qualifcations & Curriculum Authority (QCA)
Figure 4.6 shows how qualification levels have changed in recent years and show a general trend of an increasing proportion qualified to level 4 and above, while the the proportion who are not qualified to at least level 2 has fallen, suggesting an overall increase in skill levels in the local workforce.
Figure 4.6: Qualification levels of the workforce, Cheltenham, 2001-2006
[pic]
Source: Annual Population Survey via Nomis
4.5 Skills Issues
The main source of data relating to skills issues and their affect on employers is the National Employers Skills Survey (NESS). Unfortunately, there is still no data available yet from NESS 2007, meaning that 2005 is the latest data available. The 2005 survey covered around 75,000 employers across England, with just over 1,000 of these being in Gloucestershire. Although this is insufficient to allow any analysis for Cheltenham itself, it is a large enough sample to undertake some analysis at a county level.
The main headline indicators from the NESS are shown in Table 4.5. The data seems to show a significant tightening of the labour market between 2003 and 2005, with:
• Fewer employers with vacancies, and vacancies making up a lower proportion of total employment
• A falling proportion of vacancies that were classed as ‘hard to fill’ for various reasons, but an increasing proportion of vacancies that are hard to fill because employers are having difficulties finding the appropriate skills. With overall levels of vacancies declining, this suggests that employers are still experiencing shortages of skilled applicants for some jobs (although the total number of skill shortage vacancies has dropped slightly), but are now finding it easier to fill vacancies that may have previously been hard to fill due to low pay, poor conditions, unsociable working hours etc. This may well be due to the rise in migrant working since 2004, as already discussed in section 2.2.
• Just 5% of Gloucestershire employers reported internal skills gaps in 2005, compared to 15% in 2003. A Skills gap occurs when an employer perceives that one or more of its employees is not fully proficient in their current job role. The number of skills gaps, or the number of employees deemed not to be fully proficient in their role has dropped by over 40% between 2003 and 2005. This may be down to an increase in the amount of training that employers offer to employees, with the average number of days training per employee having risen from 5.4 to 7.2 between 2003 and 2005.
A more detailed analysis of NESS data for Gloucestershire can be found in a report published by Skills and Learning Module of the South West Regional Observatory (SLIM) - see references.
Table 4.5: National Employer Skills Survey Indicators, 2003-2005
|Indicator |Gloucestershire |South West |England |
|Percentage of establishments with vacancies, 2005 |18 |17 |17 |
|Percentage of establishments with vacancies, 2003 |23 |21 |17 |
|Vacancies as a percentage of employment, 2005 |2.4 |2.9 |2.7 |
|Vacancies as a percentage of employment 2003 |3.5 |3.6 |3.1 |
|Percentage of all vacancies in the region 2005 |10 |- |- |
|Hard-to-fill vacancies as a percentage of all vacancies, 2005 |30 |31 |35 |
|Hard-to-fill vacancies as a percentage of all vacancies, 2003 |45 |47 |40 |
|Percentage of all Hard-to-fill vacancies in the region 2005 |9 |- |- |
|Skills shortage vacancies as a proportion of Hard-to-fill vacancies, 2005 |66 |57 |70 |
|Skills shortage vacancies as a proportion of Hard-to-fill vacancies, 2003 |44 |37 |50 |
|Percentage of all Skills shortage vacancies in the region 2005 |11 |- |- |
|% of employers reporting internal skills gaps, 2005 |15 |15 |16 |
|Internal skills gaps as a percentage of total employment, 2005 |5 |5 |6 |
|% change in the number of skills gaps, 2003-2005 |-41 |-46 |-47 |
|Source: National Employer Skills Survey, 2003 and 2005 | | | |
4.6 Summary
• 62% of Cheltenham pupils achieved 5 or more GCSEs at grades A-C, comparable with the national average but slightly below the level achieved in Gloucester. Although this proportion has been increasing over the decade, the rate of improvement has been slower in Cheltenham compared to the national average.
• The proportion of 16 and 17 years olds participating in full-time education is higher than is the case nationally. However, there is a significant drop in participation between the ages of 16 and 17.
• The number of young people aged 18-20 from Cheltenham who have gone on to higher education has increased by nearly 20% in the last six years.
• Unemployment rates in Cheltenham have remained low over the last seven years and are consistently below the national average. Although there was an increase during 2006, the unemployment rate has fallen again through 2007, towards the very low level experienced up to 2005.
• A higher proportion of Cheltenham’s unemployed claimants have been unemployed for more than six months, suggesting a degree of structural employment. However, the number of long-term unemployed claimants was falling during 2007.
• Economic activity rates are also higher than nationally, with a high proportion of the working age population (80%) available to work.
• Relative to some other major world economies, the UK does lag behind in terms of level 2 and 3 qualifications. However, qualification levels – a good proxy measure for workforce skills – are relatively high in Cheltenham, with more than a third of the working age population qualified to degree level or higher.
• Latest available NESS data suggests that the labour market has been tightening in recent years, with falling levels of vacancies. Skill shortage vacancies still exist in significant numbers, but employers are having less difficulty filling vacancies that were hard to fill for other reasons, almost certainly assisted by rising numbers of migrant workers. The average number of days training per employee has also been rising, which has seen the number of employees who are not fully proficient in their jobs fall by more than 40% in just two years.
5. Social Exclusion & Deprivation
5.1 Indices of Deprivation 2007
The Indices of Deprivation 2007 (ID 2007) are an update to the 2004 Indices of Deprivation (ID 2004). The Index of Multiple Deprivation 2007 (IMD 2007) is a Super Output Area (SOA) level measure of multiple deprivation comprising seven domain indices:
• Income deprivation
• Employment deprivation
• Health deprivation and disability
• Education, skills and training deprivation
• Barriers to housing and services
• Living environment deprivation
• Crime
Super Output Areas are small areas that approximate neighbourhoods, with each SOA comprising just a few streets.
The IMD 2007 Rank of Average Score is the ranking of the average of the combined IMD scores for all the SOAs in a district. According to this measure, Cheltenham is the 202nd most deprived district in England, out of a total of 354 districts, with Gloucester ranked significantly higher at 118th (see Table 5.1) Similarly, the Rank of Average Rank measure ranks the average of the combined ranks for all SOAs in a district. Both measures are weighted by population. This measure ranks Cheltenham as the 221st most deprived district in England, and Gloucester 149th. Table 5.1 shows that Gloucester is the most deprived district in Gloucestershire, significantly higher up the index than any other part of the county.
Table 5.1 Index of Multiple Deprivation district ranks
|District |Rank of Average Score 2007 |Rank of Average Rank 2007 |
| |(2004 position) |(2004 position) |
|Cheltenham |202 (224) |221 (238) |
|Cotswold |298 (314) |289 (310) |
|Forest of Dean |201 (195) |174 (176) |
|Gloucester |118 (139) |149 (157) |
|Stroud |280 (289) |273 (287) |
|Tewkesbury |279 (296) |281 (297) |
Source: IMD 2007
Notes: Out of 354 English districts, 1=most deprived
The IMD 2007 was constructed by combining the seven transformed domain scores, using the following weights:
• Income (22.5%)
• Employment (22.5%)
• Health Deprivation and Disability (13.5%)
• Education, Skills and Training (13.5%)
• Barriers to Housing and Services (9.3%)
• Crime (9.3%)
• Living Environment (9.3%)
These weightings are the same as in 2004, so the 2007 Indices are therefore directly comparable (2004 positions are also shown in Table 5.1). Both Cheltenham and Gloucester find themselves higher up the index in 2007 compared to 2004, with the Forest of Dean being the only district in Gloucestershire to show an improvement in its position (using the Rank of Average Score measure).
As well as the significant variations in the level of deprivation at district level, there are also disparities evident at the SOA level. Table 5.2 details the 10 most deprived areas in Cheltenham and Gloucester, and shows that out of 32,482 English SOAs, a part of Podsmead is the most deprived in terms of the IMD Rank of Average Score with a ranking of 886. All bar one of the twenty most deprived SOAs in Gloucestershire are all to be found within Cheltenham or Gloucester. The SOA level data in the current indices allow the clearer identification of these small localised pockets of deprivation.
Table 5.2: Top ten most deprived Super Output Areas in Cheltenham and Gloucester, 2007
|Super Output Area Name |Ward |Rank |
|Gloucester 009E |Podsmead |886 |
|Gloucester 011A |Matson and Robinswood |1341 |
|Cheltenham 004C |St Paul's |1575 |
|Gloucester 004D |Westgate |1895 |
|Gloucester 002C |Kingsholm and Wotton |2360 |
|Gloucester 004B |Westgate |2745 |
|Cheltenham 005C |St Mark's |3136 |
|Cheltenham 003A |Hesters Way |3725 |
|Cheltenham 006C |Oakley |3812 |
|Gloucester 005D |Barton and Tredworth |3818 |
Source: IMD 2007
Notes: Out of 32,482 English Super Output Areas, 1=most deprived
5.2 Benefits Claimants
A good proxy for an overall measure of worklessness is the number of working-age people who are claiming one or more key benefits from the Department for Work and Pensions (DWP). Table 5.3 shows that 10.7% of the working age population were claiming at least one benefit at the end of 2007, slightly higher than in 2001. The total number of benefit claimants has risen slightly in both Cheltenham and Gloucester, while it has fallen slightly across Great Britain as a whole.
Table 5.3: Working Age Benefit Claimants, Cheltenham, Gloucester and Great Britain, 2001-2007
|Area |2001 |2007 |
| |No. |% |No. |% |
|Cheltenham |6,850 |10.0 |7,440 |10.7 |
|Gloucester |9,100 |13.6 |9,510 |13.5 |
|South West |342,820 |11.6 |359,640 |11.7 |
|Great Britain |5,264,500 |14.9 |5,214,980 |14.2 |
Source: DWP Benefits data, via Nomis
The UK Government has set a priority to reduce number of people on ‘out of work’ benefits. These benefits are as follows:
• Jobseekers Allowance
• Incapacity Benefits
• Lone parents on income support
Unfortunately, Figure 5.1 shows that there has been little change in recent years, apart from sharp drop in income support claimants between 2003 and 2004. This was due to the introduction of Working Tax Credits in April 2003, which is taken into account when eligibility for Income Support is calculated. The sudden drop can be largely attributed to these changes to eligibility, and there has been virtually no change in the number of claimants since that time.
Figure 5.1: Claimants of ‘out of work’ benefits, Cheltenham, 2001-2007
[pic]
Source: DWP Benefits data, via Nomis
5.3 Summary
• In the Index of Multiple Deprivation for 2007, both Cheltenham and Gloucester have risen up the rankings compared to their 2004 positions.
• Although Gloucester is clearly the most deprived district in Gloucester, there are some severe pockets of deprivation in Cheltenham, particularly parts of the wards of St Paul's, St Mark's, Hesters Way and Oakley.
• More than 10% of Cheltenham’s working age population were claiming at least one benefit at the end of 2007, slightly higher than in 2001.
• The number of claimants of key ‘out of work’ benefits has not changed significantly between 2001 and 2007, despite being a Government priority.
6. Conclusions
This report has presented a wide range of data to help develop a clear understanding of recent economic change in Cheltenham, and how Cheltenham’s economy relates to that of its near neighbour in Gloucester.
Some of the headline indicators don’t make for encouraging reading, with recent years seeing declining levels of GVA being generated in the local economy as a result of employment losses in some key sectors, most in notably retailing and manufacturing. In terms of GVA per head, this has seen a rapid erosion of Cheltenham’s position of strength relative to the national average, with Cheltenham now having fallen below the national average for the first time since the use of the local GVA model was introduced in Cheltenham in 1991.
There are some significant concerns for the continued health of the Cheltenham economy, driven by both external and internal influences. The first external issue is that the manufacturing sector across the UK is forecast to continue declining, with lower-skilled production activities increasingly being transferred to lower cost areas of the world.
The second external concern is the overall health of the UK economy, and the possible impact on the retail sector in Cheltenham. There is increasing speculation that the UK will soon enter a period of recession, with a downturn accelerated by the ongoing credit crunch. The effect on the housing market and mortgage lending is likely to have a significant effect on people’s disposable income, which of course will have a knock on effect on the amount people can spend on the high street. Forecasts for the sector – made before the credit crunch was seen to be a significant issue – estimate 100,000 job losses across the UK over the next two years.
While the two threats outlined above are largely external in nature, where there are no obvious interventions that could be made locally, the third is a more localised issue. Official demographic forecasts have highlighted that Cheltenham will grow significantly slower than Gloucester and compared to the country as a whole. With an increasingly older demographic profile, there will be little growth in the working age population, limiting the size of the pool of labour that local employers can make use of.
With a limited labour force available locally, employers may find it more difficult to recruit the skills they need from the local workforce. The urban extensions proposed in the draft Regional Spatial Strategy will play an important role in maintaining a sufficient size of labour force to enable local employers to recruit the people they will need to drive future economic growth.
While the future presents a number of threats and uncertainties for the local economy, there are also a number of positives that should be highlighted. Cheltenham has a relatively well-qualified workforce working in higher level occupations, with higher than average earnings and relatively low unemployment. There have also been consistently higher rates of new businesses forming, all of which points to Cheltenham having many of the essential ingredients for a successful economy.
The bulk of the economic data has highlighted a difficult period for the local economy, up to and including 2006 (the most up to date available at the time of writing). More recent data is available for some indicators, and the most positive aspect of these is that unemployment fell during 2007, suggesting fewer job losses, and generally a better outlook for Cheltenham’s economy than the previous two years.
References & Data Sources
Computing (2008) High street problems send shoppers to the web, article by Angelica Mari, Computing, 18 February 2008
Daily Telegraph (2008) Fears of 100,000 job losses in retail sector, article by James Hall, 04 February 2008
telegraph.co.uk/money/main.jhtml?xml=/money/2008/02/04/cnjobs104.xml
Gloucestershire Labour Market Information Unit (2007) The Economy of Gloucestershire 2006/07, GLMIU
Gloucestershire County Council (2007) Migrant Workers in Gloucestershire 2007
IT Week (2008) High street shopping logs on, article by Phil Muncaster, IT Week, 04 February 2008
itweek.co.uk/itweek/analysis/2208788/street-shopping-logs-3783443
SLIM (2007) The National Employer Skills Survey 2005 for the South West of England: Gloucestershire Summary Report, produced by BMG Research on behalf of SLIM, January 2007
SLIM (2007) Migrant Workers in the South West – Final Report, produced by SLIM on behalf of the South West Regional Development Agency and the South West Regional Skills Partnership, December 2007
Web Credible (2006) The online high street – e-commerce usability for UK high street retailers
Annex 1 - Detailed Data Tables
Cheltenham GVA by Output Sector 1996-2006 (£m)
Sector |1996 |1997 |1998 |1999 |2000 |2001 |2002 |2003 |2004 |2005 |2006 | |Agriculture & Forestry/Fishing |3 |1 |2 |2 |2 |2 |2 |3 |4 |3 |2 | |Mining & Quarrying/Elec., Gas & Water |14 |3 |12 |42 |71 |124 |52 |1 |3 |1 |2 | |Manufacturing |275 |297 |303 |297 |312 |315 |350 |361 |336 |319 |300 | |Construction |118 |134 |155 |174 |150 |238 |283 |317 |244 |97 |109 | |Distribution/Hotels & Catering |283 |286 |301 |332 |323 |415 |464 |489 |495 |478 |443 | |Transport & Communications |34 |35 |34 |33 |41 |38 |44 |48 |53 |48 |50 | |Finance/Business |372 |442 |467 |508 |571 |599 |635 |653 |686 |660 |718 | |Public Service |307 |338 |355 |367 |390 |410 |520 |578 |562 |487 |471 | |GVA at Basic Prices |1,407 |1,535 |1,628 |1,756 |1,859 |2,142 |2,349 |2,451 |2,382 |2,091 |2,096 | |Source: Local GVA Model
Cheltenham GVA by Output Sector 1996-2006 (%)
Sector |1996 |1997 |1998 |1999 |2000 |2001 |2002 |2003 |2004 |2005 |2006 | |Agriculture & Forestry/Fishing |0.2 |0.1 |0.1 |0.1 |0.1 |0.1 |0.1 |0.1 |0.2 |0.1 |0.1 | |Mining & Quarrying/Elec., Gas & Water |1 |0.2 |0.8 |2.4 |3.8 |5.8 |2.2 |0.1 |0.1 |0.1 |0.1 | |Manufacturing |19.6 |19.4 |18.6 |16.9 |16.8 |14.7 |14.9 |14.7 |14.1 |15.2 |14.3 | |Construction |8.4 |8.7 |9.5 |9.9 |8.1 |11.1 |12 |12.9 |10.3 |4.6 |5.2 | |Distribution/Hotels & Catering |20.1 |18.6 |18.5 |18.9 |17.4 |19.4 |19.7 |20 |20.8 |22.8 |21.1 | |Transport & Communications |2.4 |2.3 |2.1 |1.9 |2.2 |1.8 |1.9 |2 |2.2 |2.3 |2.4 | |Finance/Business |26.5 |28.8 |28.7 |28.9 |30.7 |28 |27 |26.7 |28.8 |31.5 |34.3 | |Public Service |21.8 |22 |21.8 |20.9 |21 |19.2 |22.1 |23.6 |23.6 |23.3 |22.5 | |GVA at Basic Prices |100 |100 |100 |100 |100 |100 |100 |100 |100 |100 |100 | |Source: Local GVA Model
Cheltenham Employment by Output Sector 1996-2006 (employees)
Sector |1996 |1997 |1998 |1999 |2000 |2001 |2002 |2003 |2004 |2005 |2006 | |Agriculture & Forestry/Fishing |100 |100 |100 |100 |100 |100 |100 |100 |100 |100 |100 | |Mining & Quarrying/Elec., Gas & Water |200 |200 |200 |- |200 |300 |300 |400 |100 |- |- | |Manufacturing |8,900 |9,000 |9,000 |9,700 |9,500 |9,300 |9,700 |8,600 |8,600 |8,400 |7,700 | |Construction |2,000 |1,700 |1,500 |1,700 |1,800 |2,000 |1,500 |2,200 |2,100 |1,900 |1,800 | |Distribution/Hotels & Catering |13,600 |12,300 |11,900 |12,500 |12,800 |15,100 |14,400 |17,500 |17,100 |17,100 |17,500 | |Transport & Communications |1,300 |1,300 |1,300 |1,400 |1,200 |1,100 |1,400 |1,200 |1,200 |1,200 |1,400 | |Finance/Business |9,300 |8,400 |10,700 |11,300 |11,600 |12,200 |13,300 |12,700 |11,300 |11,100 |12,000 | |Public Service |20,900 |19,400 |17,200 |19,200 |18,500 |19,500 |19,700 |19,200 |22,000 |22,300 |22,400 | |Employees in Employment |56,300 |52,400 |51,900 |55,800 |55,800 |59,600 |60,300 |61,700 |62,400 |62,000 |62,900 | |Source: Local GVA Model
Cheltenham Employment by Output Sector 1996-2006 (%)
Sector |1996 |1997 |1998 |1999 |2000 |2001 |2002 |2003 |2004 |2005 |2006 | |Agriculture & Forestry/Fishing |0.2 |0.1 |0.1 |0.1 |0.1 |0.1 |0.1 |0.1 |0.1 |0.2 |0.2 | |Mining & Quarrying/Elec., Gas & Water |0.4 |0 |0.3 |0.5 |0.5 |0.6 |0.1 |0 |0 |0.0 |0.0 | |Manufacturing |17.3 |17.4 |17.1 |15.7 |16 |13.9 |13.8 |13.5 |12.2 |13.2 |12.0 | |Construction |2.9 |3 |3.3 |3.3 |2.5 |3.5 |3.4 |3 |2.9 |2.6 |3.1 | |Distribution/Hotels & Catering |22.9 |22.4 |23 |25.4 |23.9 |28.3 |27.3 |27.5 |27.8 |31.1 |28.9 | |Transport & Communications |2.6 |2.4 |2.2 |1.9 |2.3 |1.9 |1.8 |1.9 |2.2 |2.0 |2.1 | |Finance/Business |20.6 |20.2 |20.9 |20.5 |22.1 |20.7 |18.1 |17.9 |19.1 |18.3 |20.9 | |Public Service |33.2 |34.5 |33.1 |32.6 |32.7 |31.1 |35.2 |36 |35.6 |32.4 |32.8 | |Employees in Employment |100 |100 |100 |100 |100 |100 |100 |100 |100 |100.0 |100.0 | |Source: Local GVA Model
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