Agenda item

Attending for this item:

Cllr Marc Bayliss, Cabinet Member for Economy and Skills

John Hobbs, Director of Economy and Infrastructure

Rachel Hill, Assistant Director for Economy, Major Projects and Waste

Sue Crow, Economic Growth and Investment Manager

The Cabinet Member with Responsibility for Economy and Skills and senior Officers from the Directorate of Economy and Infrastructure had been invited to the meeting to provide an update on the Council’s support to businesses during the Covid pandemic.

The Cabinet Member began by reminding the Panel that his brief was different to the one covered by his predecessor (which had been Economy and Infrastructure).  As Cabinet Member, he was open to challenge and welcomed any comments and ideas from Panel Members.

In the course of the discussion, the following main points were raised:

·       The working-age population of Worcestershire (ie those aged between 16 and 64) made up 60% of the total population of the County.  However, it was noted that an increasing number of people were working beyond traditional retirement age.

·       Nearly 75% of businesses in the County were micro-businesses employing 4 or less people.  However, 50% of the workforce were employed by the 1.6% of businesses employing over 50 people.

·       The Worcestershire Covid-19 Economic Response, Recovery and Resilience Group (WCERG) comprised all local stakeholders.  The Group had developed an economic recovery framework with five key areas of focus.

·       Worcestershire’s Claimant Count rate was lower than the regional or national rate but it had almost doubled since March 2020.  In the last month the rate had started to fall and the economy seemed to be in a period of strong bounceback.

·       Young people had seen the worst impact.  They had found it most difficult to find employment and had been the first to be laid off.  The Cabinet Member referred to the ‘scarring’ impact this could have and expressed concern that this might have a lifelong impact for some young people.  The Claimant Count for 16-24 year-olds in Worcestershire was 6.8% compared with 4.3% for the overall workforce.

·       As at 30 June, 6% of the workforce were on furlough, which was slightly lower than the West Midlands and England averages.  The figure was slightly higher in Redditch at 8%.  The end of furlough this month would undoubtedly see a rise in the number of claimants.  However, there was also positive news in that as at 20 August the number of job adverts in the West Midlands was 147% above the February 2020 average level.

·       A Member suggested that a major problem for micro businesses was finding simple, no frills premises with the opportunity to buy the freehold as an investment and to give the business stability.  The Cabinet Member agreed and suggested that supporting and growing local businesses could be a more successful strategy than attracting inward investors.  He agreed that accessing cheap and cheerful premises with flexible terms was important and he was working with the district councils and the Director to develop a suitable progression pathway.

·       In response to a question about why Wychavon had seen the highest percentage rise in the claimant count since March 2020, the Cabinet Member informed the Panel that this was still being looked into.  Further data would be provided in due course.

·       The Cabinet Member agreed that it was important to support young people whose employment opportunities had been affected by the pandemic.  He referred to the Government’s Kickstart scheme, which provided work experience for young people and met all employment costs.  Worcestershire County Council was about to take its first cohort as part of the scheme.  Skills training programmes were also important as they kept people in active learning while they were not in employment.

·       The Cabinet Member confirmed that, although the County Council had previously been involved in schemes providing shared office premises for local businesses (for example The Kiln in Worcester), he was not aware of any similar current schemes for shared business premises.

·       The Economic Growth and Investment Manager provided further details on the Kickstart scheme.  To date, 900 placements with local employers had been identified with over 200 already filled.  Members were reminded that the Worcestershire jobs website listed all current vacancies for jobs and apprenticeships in the County.

·       The outcome of Worcestershire’s bid to the Community Renewal Fund had not yet been received.  Wyre Forest had been identified as a priority place for this fund.

·       A request was made for further data on jobs available in Worcestershire broken down by job type and pay scale if possible.  A Member pointed out that the majority of current vacancies were in the care, logistics and hospitality sectors and asked what was being done to attract more high quality, high salary jobs.  The Cabinet Member acknowledged that there was a consistent, long-term wage gap with average wages in the County 15% below the national average.  Work was ongoing to close this gap with a strategy of increasing the number of higher value, better paid jobs.  Although average wages had risen, the gap remained the same.

·       The Chairman suggested that, given the high percentage of micro businesses in the County, it may be difficult to work out pay rates due to different pay structures and methods of pay (for example share dividends) and therefore more well-paid jobs might be ‘hidden’.  The Cabinet Member did not think this was the case as the number of micro businesses was similar in other comparable local authorities.  He also pointed out that house prices and the cost of living in Worcestershire was lower than other parts of the country so real income was similar.

·       The Cabinet Member confirmed that he was very keen to visit local businesses and meet local business owners.  He confirmed that this would include micro and small businesses.

·       It was confirmed that projects supporting local businesses were funded to June 2023.  This included support and guidance for business start-ups, a programme supporting existing businesses to pivot and grow, and help for manufacturers to adopt new technology, supported by the roll out of superfast broadband.  Other projects supported innovation and the ‘greening’ of local businesses with a focus on energy efficiency and low carbon technology.

·       The County Council had originally allocated £3.5 million to business support via the Here2Help Business Programme, and had recently committed a further £900k.  This included business grants, specific support for agricultural businesses, a graduate programme and a business mentoring buddy system.

·       It was confirmed that the programme was about to be re-launched with the extra £900k of funding and would be accepting further expressions of interest from local businesses.  The average business grant was £25k.  The Cabinet Member acknowledged that the extra funding would soon be used up but confirmed that plans were being made for the Here2Help Business Programme to continue in the future.

·       In response to a question about feedback from businesses on the support provided, it was confirmed that two business surveys had been completed and a third was planned for October.  It was agreed that feedback would be shared with the Panel.

·       The Cabinet Member confirmed that he wanted to use public money to help businesses which were in genuine need and target the resources where they would make most difference.

·       The Vice Chairman of the Overview and Scrutiny Performance Board (OSPB) reminded the Panel that he was also the portfolio holder for Economic Growth and Tourism at Wychavon District Council.

·       It was agreed that a list of useful websites (including Business Central, Here2Help and Worcestershire Jobs) would be circulated to Members to help them to signpost residents to available support.

·       A Member suggested that it would be helpful to simplify or summarise some of the material for the Here2Help scheme as it was a challenge for business owners to find the time to read all of the information relating to grants and other support to see if they were eligible.  The Cabinet Member acknowledged the point and agreed that this would be done where possible.  He had asked the team to look at a simplified offer and would seek to work more closely with the district councils to deliver effective support.  It was confirmed that Worcestershire Business Central provided a support desk which provided telephone support for businesses.

·       The Panel was provided with a summary of the current Employment Land Programme including developments relating to Worcester 6, Redditch Gateway, Malvern Technology Park, Redditch Rail and Shrub Hill.

·       In response to a question about whether wages at businesses sited at Worcester 6 were above average, the Cabinet Member confirmed that data was not available on this, although he suspected this was not the case.  He reminded the Panel that, although the County Council could encourage higher value employment, it was not the landowner and so had limited influence on which businesses used the site.

·       In relation to Redditch Rail, the Cabinet Member confirmed that £5 million had already been committed and the County Council was currently in discussion with the District Council and the LEPs about further funding opportunities.  This was a good location and, although the County Council was committed to the project, it could not provide the resources alone.

·       The Cabinet Member agreed that the current disabled access arrangements at Shrub Hill station were totally unsatisfactory.  He confirmed that disabled access would be a priority for the redeveloped site and this would be one of the real benefits of the scheme.  It was acknowledged that there were existing businesses with leases at the site and it would be important to deal with them sensitively when the redevelopment went ahead.  If the scheme was approved, work could start immediately but the full scheme may take 10 years to complete.  It was agreed that a site visit would be arranged for the Panel in due course.

·       It was confirmed that the County Council was looking at further ‘game changer’ sites and wanted to ensure good geographical coverage across the County.  However, the locations could not be disclosed at this stage due to commercial sensitivities.

·       In relation to Visit Worcestershire, the Panel was told that the service had been rebranded with a redeveloped website and a focus on social media.  The tourism awards had been relaunched and were now linked to Visit Britain with winners going forward to the national awards.

·       The Chairman of the OSPB asked whether the success of Worcestershire Parkway station had implications for Shrub Hill in terms of passenger numbers.  It was confirmed that no specific data was available on this, although the total number of rail travellers was only at 50% of its pre-covid level.  The County Council would continue to monitor this but the current view was that all three stations were viable going forward.

·       It was agreed that the Panel would receive a further update on the local economy in 12 months’ time and this should include data from February 2022 to allow the impact of covid to be assessed.

·       A Member asked a specific question about the business energy efficiency programme and the difficulty of obtaining previous data to demonstrate improvement.  It was agreed that this would be followed up outside of the meeting.

·       It was confirmed that Visit Worcestershire had a small budget for national advertising and the impact of the service was measured by recording website hits and social media ‘click through’.  The annual economic impact survey included tourism but it was confirmed that this did not include data by division.  It was confirmed that articles in the national press, such as the recent one on Droitwich in The Sunday Times, were encouraged as they were cost free.

·       The Cabinet Member confirmed that, although he had met with food packaging and processing companies, he had not yet met with growers in the County but was happy to do this in the future.  He asked Members to contact him if there was a business in their division that they felt he should visit.

·       The Cabinet Member thanked the Panel for the opportunity to attend the meeting and confirmed that he would provide a similar update in 12 months’ time.