Patterns of Economic Activity and Proportions Employed in High Value

Home , East Cambridgeshire, Fenland District

Overall employment rate High and stable (83%) - green

Patterns of economic activity and proportions Average earnings employed in high value Average but rising jobs (£500p/w) yellow

Jobs Density Low but rising (0.6) red

Levels of self employment Average and stable (13%) yellow Entrepreneurial culture

Vat registrations Low and decreasing red

16-18 year olds who are not in education, employment or training* Low Skills levels and green aspirations Working age population qualified to at least level 2 or higher * Low and stable (69%) red

Patterns of Working age people on out of unemployment and work benefits* deprivation Low and stable green

Housing affordability Housing affordability Low but rising (7.2 ratio to earnings) red * Key Indicator

Key Issues • Skills disparity – average skills levels pushed up by those commuting out of the district • High number of businesses but low levels of employment within those businesses • Relative dependence on lower value manufacturing, processing and construction

1 South Cambridgeshire Huntingdonshire Cambridge City East Cambridgeshire Fenland Performance Performance Performance Performance Performance ECONOMIC ASSESSMENT OVERVIEW against Performance against Performance against Performance against Performance against Performance Cambridgeshire against national Direction Cambridgeshire against national Direction Cambridgeshire against national Direction Cambridgeshire against national Direction Cambridgeshire against national Direction target/average average of Travel target/average average of Travel target/average average of Travel target/average average of Travel target/average average of Travel

PEOPLE NI151 Overall Employment rate (working age) KLKJK NI 152 Working age people on out of work benefits KKKKK NI 163 Proportion of working age population qualifed to at least Level 2 or higher KKJJJ NI165 Proportion of working age population qualifed to at least Level 4 or higher KKKKJ NI 75 5+ A*-C grades at GCSE inc Eng and Maths KKJKK

BUSINESS NI171 New business registration rate LLLLL NI172 Percentage of small businesses in an area showing employment growth KKKKK Labour productivity KKKKJ Job Density Ratio KKLKL NI 166 Median earnings of employees in the area KKKKK

PLACE CO2 emissions per head LLLLL Housing Affordability JJJJJ GVA per Capita KKKKJ Place Survey Results

St Edmondsbury Forest Heath Uttlesford North Hertfordshire Performance Performance Performance Performance against Performance against Performance against Performance against Performance Cambridgeshire against national Direction Cambridgeshire against national Direction Cambridgeshire against national Direction Cambridgeshire against national Direction target/average average of Travel target/average average of Travel target/average average of Travel target/average average of Travel

PEOPLE NI151 Overall Employment rate (working age) JJ L K NI 152 Working age people on out of work benefits KKKK NI 163 Proportion of working age population qualifed to at least Level 2 or higher JJ K K NI165 Proportion of working age population qualifed to at least Level 4 or higher KKKK NI 75 5+ A*-C grades at GCSE inc Eng and Maths KKKK

BUSINESS NI171 New business registration rate LLLL NI172 Percentage of small businesses in an area showing employment growth KKKK Labour productivity KKKK Job Density Ratio KKKK NI 166 Median earnings of employees in the area KKKK

PLACE CO2 emissions per head LLLL Housing Affordability JJJJ GVA per Capita KKKK

Place Survey Results

KEY Better than average Similar to average Below average Significantly below average KJL direction of travel over the past 5 years

2 East Cambridgeshire SWOT

Strengths

Relatively high levels of resident satisfaction, as measured by the ‘place’ survey.

Low levels of recorded crime (although slow increase over April, May and June 2010)

Low levels of unemployment or benefit claimants and high levels of economic activity.

Longer term loss of business floorspace but recent net increase of office and general industry space, particularly around Ely

Weaknesses

Many higher skilled workers commute out of the district to work in Cambridge.

Relatively low levels of prosperity, particularly in the north of the district. The recession has increased employment disparities within the district and there exist pockets of deprivation in Ely and Littleport, particularly regarding education, skills and training.

Significant skills disparity within the district; a relatively high proportion qualified to NVQ level 4+ but an equally high proportion of adults without NVQ level 2. Relatively high educational attainment levels of 14- 19 year olds implies that the majority of well educated younger people move away from the district.

Poor accessibility of jobs by public transport, cycling or walking

Opportunities

Strengths in higher value manufacturing, particularly chemicals.

Low public sector employment and a high proportion of employment in skilled trades.

Relatively high business density but a low jobs density caused by a very high proportion of ‘micro’ businesses. Jobs density is however increasing.

Growing renewable energy infrastructure

Threats

A relatively small but growing population – however growth is forecast to be concentrated in the populated aged 45 and over.

High dependence on migrant workers in the agriculture and horticulture industries threatened by a recent trend for workers to return to their country of origin.

Intermediate levels skills shortage, particularly in technical and skilled trade occupations, due to a low proportion of adults with NVQ level 3 qualifications.

Dependence on manufacturing (mainly low value), processing and construction. A relatively low value economy compared with Greater Cambridge as a whole.

High proportion of long established businesses and low birth rate of new enterprises could indicate low ‘business churn’, a lack of competition and restricted innovation.

Poor broadband infrastructure

Low housing affordability and recent fall in housing completions

Labour market, prosperity and crime

A relatively small, gradually ageing population • East Cambridgeshire is one of the least populous of the Greater Cambridge districts with an estimated population of 79,400 residents. • 60.5% are of working age – a slightly lower proportion than seen nationally (62%). • Forecast levels of population growth to 2021 anticipate a similar rate of population growth to that seen across the region as a whole, however much of this growth is anticipated to be in the population aged 45 and over.

Out commuting of higher skilled workers • There is significant commuting out of the district into Cambridge and two way commuting links with Forest Heath. • A higher proportion of residents than workers, work in high value occupations. This suggests that higher skilled residents commute out of the district to work most likely in associate professional and technical occupations.

High dependence on migrant workers in the agriculture and horticulture industries • Levels of National Insurance registrations in East Cambridgeshire have steadily increased since 2002 and were the second highest in the county in 2008/09 however more recently there are indications that workers are returning to their countries of origin. • Since 2004, nearly 20% of the county’s A8 migrants registered to work in East Cambridgeshire’s agricultural sector. • Research suggests businesses in some sectors would not be able function to full capacity if migrant workers were not available. The Working Lives Institute, in undertaking research for EEDA in 2005, found that the largest employers of migrant workers in agriculture and horticulture were based around Ely and Wisbech.

Relatively low levels of prosperity, particularly in the north of the district. • Median weekly earnings are below the Cambridgeshire and national average, and the rate of increase over the last five years has been one of the lowest in the county. • Although a low proportion of households within East Cambridgeshire have an annual income under £20k those that do are concentrated to the north. See Map 3 in Appendices. • Relatively low GVA per capita compared with the UK average.

Relatively high levels of resident satisfaction • The 2008 place survey recorded that 87% of East Cambridgeshire residents were satisfied with their local area as a place to live, similar to the average across Cambridgeshire and above the national average of 80%.

Low levels of recorded crime • Cambridgeshire Police collate data for the Crime and Disorder Reduction Partnerships within the county on crime trends. Across Greater Cambridge the lowest numbers of crime are recorded in South Cambridgeshire and East Cambridgeshire. • The level of crime in East Cambridgeshire has remained relatively unchanged over the past three years. Whilst there has been a slight decline over the past year this may change due to a slow increase in cases over April, May and June 2010.

Skills levels, education and skills demand

Significant skills disparity within the district • Although a relatively high proportion of working age residents are qualified to NVQ 4+ (degree level) an equally high proportion of the population are only qualified to NVQ level 1 (5 GCSEs grade D-E). • Whereas the proportions qualified to NVQ levels 1 and 2 have remained relatively stable since 1999, the proportions qualified to NVQ levels 3 and 4+ increased significantly in 2005. This may reflect well qualified people migrating into the area following the house building around Ely. • Within the county, East Cambridgeshire has the second lowest proportion (60%) of residents qualified to NVQ level 2 or above (5 GCES A*-C).

Relatively high educational attainment levels – implying out migration of skilled youth • The district has a relatively low proportion of 16-19 year olds Not in Employment, Education or Training • Pupil attainment at Key Stage 4 is above the national average with around 55% of pupils living in the district achieving at least five GCSEs graded A*-C including maths and English

Likely intermediate level skills shortages, particularly in technical and skilled trade occupations • Each district in Cambridgeshire has a lower than average proportion of its population holding level 3 (recognised as ‘intermediate level’) as their highest qualification. • The National Skills Audit 2010 found that the highest ‘density’ of skills shortages (i.e. relative to the numbers in the occupation) are found in associate professional/technical, skilled trades and personal service occupations, all of which require predominantly intermediate level skills. • Associate technical/professional and skilled trade occupations are essential in many advanced manufacturing; skills shortages in these areas could be restricting their growth in the sub region.

Patterns of unemployment and deprivation

Low levels of unemployment or benefit claimants however the recession has increased employment disparities within the district • Only 4% of the economically active population are unemployed, significantly lower than the national rate of 7% and second lowest within the county. • The proportion of the population claiming Incapacity benefit or Employment and Support allowance is the second lowest in the county at 3.7%, 3% lower than the national average. • 2.4% of East Cambridgeshire’s working age population claim Job Seekers Allowance, up from 1% at the start of the recession – a smaller increase than that seen nationally. However, the highest increases have been concentrated in the areas with the highest rates, notably Littleport.

Generally low levels of deprivation but pockets in Ely and Littleport • One Lower Super Output Area within East Cambridgeshire (within Littleport) is among the most deprived national 20% in terms of education, skills and training, but generally the district has relatively low levels of deprivation with 34% of its 47 Lower Super Output Areas within the least deprived 20% nationally. • There is however a north, south divide within the district, with consistent pockets of deprivation in Ely and Littleport. See Map 4 in Appendices.

5 Nature of the economy

Relatively low value economy compared with Greater Cambridge as a whole • Around 54% of the district’s residents are employed in ‘high value’ occupations, the same proportion as seen nationally, however 8% lower than that across Cambridgeshire as a whole. • A relatively high proportion of residents work in skilled trades. • Median weekly earnings are below the Cambridgeshire and national average, and the rate of increase over the last five years has been one of the lowest in the county. • Labour productivity is amongst the lowest of all Greater Cambridge districts and lower than the UK average.

Dependence on manufacturing (mainly low value), processing and construction. Low public sector employment and significant level of employment in skilled trades. Strengths in higher value manufacturing, particularly chemicals. • The construction sector accounts for the largest number of businesses and the district has twice the national proportion of businesses in agriculture, forestry and fishing. • The dominant employment sectors are manufacturing, education, transport and storage and the district has around three times the national proportion employed in primary industries. • Employment in the manufacture of agricultural and forest machinery and manufacture of insulated wire and cable are respectively 29 and 18 times higher than the national average. • The district has some employment concentrations in higher value manufacturing, namely the manufacture of chemical products, instruments and television/radio receivers. Hi-tech employment accounts for around 5% of all East Cambridgeshire jobs, mainly located around Ely – see maps 1 and 2. • Employment in the public sector stands at just under 20% compared with a national figure of 29%.

High proportion of ‘micro’ businesses • In March 2009 there were 3,985 local units in VAT and/or PAYE based enterprises in East Cambridgeshire creating around 30,000 jobs. • Within Greater Cambridge, East Cambridgeshire and Uttlesford have the highest proportions of “micro” (0-9 employee) businesses at 87%, significantly higher than the national proportion of 83%. • Within Greater Cambridge, turnover is lowest in Fenland and East Cambridgeshire enterprises

Relatively high business density but low (increasing) jobs density • A high density of businesses is crucial in creating the levels of agglomeration required to enable effective knowledge flow between people and firms, important for the growth of any successful economy. • Business density in East Cambridgeshire is similar to that seen across the wider East of England and higher than seen nationally and has steadily increased since 2001. • East Cambridgeshire has a jobs density of 0.6 (significantly below the national average and the lowest of all Greater Cambridge districts) indicating that the districts labour demand is not as high as its available workforce. However jobs density did increase significantly between 2000 and 2008 and East Cambridgeshire had the highest rate of increase in jobs between 2001 and 2008.

High proportion of long established businesses and low birth rate of new enterprises could indicate low ‘business churn’, a lack of competition and restricted innovation. • Both Fenland and East Cambridgeshire have a higher than average proportion of long established businesses • However, the birth rate of new enterprises, per 100 active enterprises, was lowest in Fenland and East Cambridgeshire and significantly lower than the national rate. • Business Link start up patterns also show a relatively small number of new businesses created in East Cambridgeshire between 2007 and 2010. • Levels of self employment are just below the national average implying there is not a significantly large number of businesses sitting below the VAT/PAYE threshold

Relatively low employment growth among existing businesses • The proportion of enterprises with employment less than 50 showing employment growth was just under 14% in 2008, very similar to regional and national figures but one of the lowest figures among Greater Cambridge districts.

Business Development, Infrastructure and Housing

Poor accessibility of jobs • Like many other rural counties, accessibility of jobs by public transport, cycling or walking is relatively low across Cambridgeshire but lowest within East Cambridgeshire.

Longer term loss of business floorspace, but recent net increase, particularly around Ely • Since 1999 there has been an overall loss of business floorspace, mainly in some larger East Cambridgeshire settlements including Soham and Burwell. • However, between 2008 and 2009 East Cambridgeshire saw a net increase in business floorspace, predominantly made up of B1a (office) and B2 (general industry) but also including 2000 sq m of research and development floor space – the highest net increase in R&D floorspace of all Cambridgeshire districts that year. The most significant recent developments have been in and around Ely.

High proportion of warehouse and factory space but recent increase in office space • In terms of total business floorspace in 2008, East Cambridgeshire had one of the highest proportion of warehouse and factory space of all Greater Cambridge districts with nearly 80% of all business floorspace allocated for these uses. This is nearly 20% more than the proportion seen nationally. • Only 9% of business floorspace is currently allocated as office use, just under half the proportion seen across the wider East of England, however between 2008 and 2009 a significant proportion of business development was made up of B1a and B1b space.

Moderate increase in retail floorspace in town centres. • Over the last ten years town centres in all districts have seen small reductions in office space however most have seen an increase in retail floorspace – within East Cambridgeshire that increase has been moderate compared to other Cambridgeshire districts. • There are very few commitments for retail development in East Cambridgeshire from 2009.

Poor broadband infrastructure • Over 50% of East Cambridgeshire wards, particularly those furthest away from Ely and Newmarket, are at risk of not receiving next generation broadband access through likely future market rollout.

Low housing affordability • The average house price in East Cambridgeshire (Dec 2009 to May 2010) was £224,000. • Lower quartile house prices are around 5-8 times lower quartile salary. • Housing is least affordable in the Dullingham Villages and Swaffhams wards and most affordable in Soham north and Littleport East however, still significantly above the 3.5 income to household ratio defined by CLG as ‘affordable’, particularly closer to Cambridge.

Recent fall in housing completions • Like most other districts, East Cambridgeshire saw a significant fall in the number of dwelling completed over 2008-2010.

Growing renewable energy infrastructure • East Cambridgeshire also has a fairly high proportion of Cambridgeshire’s total renewable energy capacity due to the straw burning power station at Sutton and capacity to develop this sector further.

7 Future prospects

Increase in employment • The East of England forecasting model forecasts that East Cambridgeshire will see relatively strong levels of employment growth between 2010 and 2021.

Increase in GVA • GVA growth forecasts suggest growth of GVA in East Cambridgeshire will be third highest among Cambridgeshire districts.

Employment demand in associate technical and professional occupations • Occupational forecasts for Cambridgeshire based on both the East of England forecasting model and the Local Economy Forecasting model estimate that over the next five years expansion demand is likely to be strongest in: o Caring personal service occupations o Managers and senior officials o Associate technical and professional occupations o Professional occupations o Sales and customer service occupations

Gradually ageing population • Forecast levels of population growth to 2021 anticipate a similar rate of population growth to that seen across the region as a whole, however much of this growth is anticipated to be in the population aged 45 and over.

8 Appendices

Map 1: All Hi-tech ‘Community’ Businesses in Cambridgeshire and Peterborough 2008 Source: Cambridgeshire County Council Research Group

Map 2: Employment in the Hi-tech 'Community', 2008 Source: Cambridgeshire County Council Research Group

Map 3: % households with annual income of less than £20,000, by electoral ward Source: CACI PayCheck 2009

11 Map 4: Education, Skills and Training Deprivation Source: CLG ID2007