We are in another three weeks of lockdown and it remains a very uncertain time for our economy. Both the public and private sector are still very much in 'emergency response', the Government has not yet shared its thinking behind an 'exit strategy' and there is no blueprint as to what the path to recovery should look like, and indeed how much this might cost.
As we look ahead to the future, as difficult as this may be to contemplate, now is the time to ask ourselves "what might a 'socially distanced economy in the Coast to Capital area look like?" For an area with the sector strengths that we have, this is not as simple as more working from home and shifting production online. This blog will highlight a few points of consideration.
Place Based Approach
In the UK, and in terms of regional policy, it is clear that a place based approach is needed which recognises unique place impacts. As highlighted last week, Centre for Cities estimates Crawley to be the most exposed of the UK's large towns and cities with over half of its jobs either in vulnerable or very vulnerable sectors. As places will be impacted differently according to their industrial structure and diverse economy, there is a strong argument for place-specific support for towns and cities that are most at risk due to high levels of employment in vulnerable sectors.
Airport Places
As a Local Enterprise Partnership area with an airport at its heart, the concept of 'airport places' needs significant thought. Gatwick Airport has seen a drastic reduction is passenger numbers. And whilst the flights that are in the air are not full of passengers right now, they will be carrying cargo which has become a vital source of income for airlines with the number of cargo-only flights increasing. The aviation sector is facing a potential structural change to a constrained 'socially distanced' and 'temperature test enabled' commercial offer with a greater focus on cargo to maintain its income. The approach that Gatwick may be able to take - the timing of this is yet to be seen.
Limiting the Damage
There are however, sectors where demand will become strong again when restrictions are eventually lifted and it is important to limit the damage to these sectors now. The agriculture and horticulture sector in our area is an example of a sector where spring/summer is the peak season, and profits at this time sustain the business during the winter months. There are concerns that without decisive intervention many in this sector will not be able to survive what, in essence, will be three consecutive winters.
Sector Strengths
As well as considering our most vulnerable sectors we will also be looking at our sector strengths and identifying and targeting our growth sectors. We are national leaders in 5G and we have a strong knowledge economy based in Brighton. How can we use this to our advantage and help other sectors in the Coast to Capital area to adapt and innovate?
Helping SMEs
Our Backing Business Grants are helping SMEs to innovate, evolve and adapt to COVID-19 to make immediate adjustments, but how do we help SMEs in the medium term to adjust to a new economy. These businesses are trying to understand their markets - when they will return and if they do, what shape they will be in - and if there are any new requirements/trends. Scenario planning, restructuring, renegotiating and re-engineering supply chains will be key activities along with financial planning, including securing and rebuilding cash reserves, continuity planning, risk management and building resilience and productivity. Our Growth Hub is providing advice on all of these topics but can we target wider infrastructure investments or promote innovations to help SMEs access their 'socially distant' markets or reach new ones?
Environmental Considerations
But we also shouldn't forget environmental considerations which are hugely important for our region. Amsterdam is set to embrace a 'doughnut' model' to mend their post-coronavirus economy which guides what it means for countries, cities and people to thrive in balance with the planet. The central premise is simple: the goal of economic activity should be about meeting the core needs of all but within the means of the planet.
Social Changes
Finally, a recent report has indicated that only 9% of Britons want to return to life as 'normal' reporting that people are enjoying cleaner air, better food and stronger social bonds. We have an opportunity to determine the social changes we want to continue into the future.
Business as Better
Rather than returning to Business as Usual there is a strong argument that we should aim for Business as Better. And Coast to Capital is strategically placed to bring leaders and experts together from across the region to determine how we can build the UK's best 'socially distanced' economy.
Themes we are currently discussing include:
- How are places going to change to manage the health risk - can we pilot a 'safe town' in the UK, set up to operate in safe and socially distanced way?
- What does sustainable transport look like in the future?
- Interventions and support required for re-skilling, job matching and re-deployment etc.
- The speeding up of economic reform - town centres - Gatwick and Brighton becoming distinct.
- The impact on older population groups etc.
One thing is clear - we need to respond quickly and decisively. And this will be the focus of our Local Industrial Strategy.
Jonathan Sharrock,
Chief Executive at Coast to Capital
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