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MIDDLESBROUGH COUNCIL
ECONOMIC DEVELOPMENT STRATEGY 2006
CONTENTS
1. Introduction Middlesbrough Renaissance page 2
…. Moving Forward
2. Vision and Key Indicators of Success page 4
3. Hierarchy of Strategies page 9
4. Our Plans for Achieving Success
Middlesbrough Regeneration Strategy page 15
Building the Enterprising City-Regeneration page 23
Middlesbrough Employment Strategy page 29
Cross-Cutting Issues page 35
5. Delivering the Strategy page 43
ECONOMIC DEVELOPMENT STRATEGY DRAFT
1. Middlesbrough Renaissance…Moving Forward
1.1 Middlesbrough is in the middle of a dynamic urban renaissance. The town is
moving forward, led by a vision created with our partners in The Middlesbrough
Partnership, Tees Valley Regeneration, private sector partners and public sector bodies, and a community that wants to see Middlesbrough change for the better through sustainable regeneration activities and by creating a more aspirational and enterprising culture. The Mayor of Middlesbrough’s vision is to create a ‘designer label’ town through broadening the base of the economy and enabling local businesses and residents to become engaged in the regeneration opportunities and to prosper. Central to this vision is the encouragement of enterprise and the promotion of employment opportunities, the blueprint for which is to be set out in this the Council’s first Economic Development Strategy.
1.2 Middlesbrough is currently at a pivotal point in achieving an improvement in its
economic fortunes. Our traditionally higher than average unemployment rate has been steadily falling and we are moving towards convergence with the rates for the rest of the North East. However there is still much to be done, in particular the challenge of ensuring that the remainder of our population that are not working are given the opportunity to gain employment.
1.3 The latest annual business inquiry figures show that in 2004 the number of
businesses in the town grew by over 3%. Property rental returns have been
rising and so has the value of business and commercial property throughout
the town.
1.4 From a fragile base, business confidence is improving, underpinned by the
major regeneration projects that are underway in the town centre and at
Middlehaven, and in the exciting developing business sectors of new
technology and digital media.
1.5 The improving economy is also having an impact on residential values,
particularly in the suburbs and there are the first signs of a revival in demand for town centre living.
1.6 Clearly much is being achieved, but many challenges remain.
The purpose of this document is to set out an economic vision for
Middlesbrough in 2021 and to articulate how enterprise is to be
encouraged and employment generated to meet that vision.
2. Vision and Key Indicators of success
2.1 ‘By 2021 The Middlesbrough Economy will be fulfilling a key role at the heart of the Tees Valley City Region and matching the average of North East local authorities in terms of enterprise and employment’
Success will be measured against the basket of key indicators and targets set out below. In broad terms our aim is to achieve parity with regional performance in 2021, and with national performance in 2031. This assumes that current levels of investment are broadly maintained (set out in section 5 ‘The Resource Plan’). Any significant losses of programmes/investment will result in a slowing in the projected timescale for meeting the targets, whilst additional programmes/investment will result in a hastening of the projected timescale. In particular, the securing of Local Enterprise Growth Initiative funding will have a significant impact on our ability to achieve our objectives in a shorter timescale.
· Baseline- Middlesbrough has a population of 137,000 people and has been for
some time suffering de-population. 61.8% (82,500) of the population is of working
age. The population of the Borough has been in decline for many years and is
projected on current trends to fall to 130,000 by 2021.
●Target 1- A reversal of the trend of de-population through successful regeneration
and economic development programmes to achieve a population for Middlesbough
of 140,000 by 2021.
● Baseline- There are 57,100 economically active people in Middlesbrough which
equates to 71.1% of the working population. This is below both the regional (74.8%)
and national (78.3%) average. 75.1% of males and 67% of females of working age
are economically active.
●Target 2 - By 2021 to increase the percentage of economically active to the
regional average and to ensure that the number of females of working age that are
economically active has converged to within 5% of males.
● Baseline- The employment rate amongst people of working age in the Borough
(65.1%) is significantly below both the regional (70.3%) and national (74.5%) figures
●Target 3 – There is a national target to achieve an employment rate of 80%
(timescale not specified by government). We will contribute to this by meeting
regional parity by 2021 and parity with the national employment rate by 2031.
● Baseline- In December 2005, Middlesbrough had an ILO 1 unemployment rate of
8.4% and a JSA 2 claimant count rate of 4.4%, the highest in the Tees
Valley (Tees Valley average 3.5%;North East 3.0%) and approaching twice the GB average of 2.4%. 39.2% of JSA claimants in Middlesbrough had been claiming for 26 weeks or more.
● Target 4 – By 2021 achieve an ILO rate and a JSA claimant count rate converging
with the regional average. Reduce the long term unemployment rate to 33% of JSA
claimants claiming for 26 weeks or more.
● Baseline-There are almost five times more IB/IS ³ claimants (19,765) than JSA
claimants (4,034) and numbers of IB/IS claimants have been fairly static in recent
years.
1 - ILO – International Labour Organisation is now widely the accepted as the most appropriate measurement of unemployment measurement.
2. - JSA Job Seekers Allowance
3. - IB/IS Incapacity Benefit/Income Support
●Target 5 – Middlesbrough will have an IB/IS claimant rate that falls in line
with that for JSA claimants and achieves parity with regional levels by 2021.
· Baseline-The Working Age Population of Middlesbrough have 39% (2004/5
Labour force Survey) of adults not qualified to Level 2 compared to 36% across the
North East region and 34% nationally.
· Target 6 By 2021 to decrease the number of adults in Middlesbrough not
qualified to Level 2 to the regional average.
● Baseline – In January 2006, Middlesbrough had the highest percentage of 16-18
year olds not in education, employment and training (NEET) in the Tees Valley with
13.5% (744) of young people aged 16-18 NEET and a further 9.5%(454) whose
status was not known.
● Target 7 - By 2021 the number of NEETS will be reduced to reflect the GB average
of 10.2%. The numbers of 16-18 years old where the status is unknown will also
reflect the GB average of 6.8%. (Note: Middlesbrough Learning Partnership is currently reviewing its NEET strategy and this target may be revised).
● Baseline- Middlesbrough has a limited tradition of entrepreneurship and this is
reflected in low business formation rates and a poor GVA per head. The GVA per
head for South Tees (Middlesbrough/Redcar & Cleveland municipal areas) is
£11,078 compared with £12,805 across the Tees Valley and £16,485 in the UK
Target 8 – The South Tees GVA per head will increase to the Tees Valley average
by 2016.
● Baseline The business rate (measured through VAT registration rates) is failing to
thrive. The VAT stock per 1000 residents in 2005 was only 13.2 in Middlesbrough
compared with 15.6 for the Tees Valley 23.4 in the North East and 30.3 in the UK.
De-registrations have exceeded the national average.
● Target 9 -The VAT stock per 1000 residents in Middlesbrough will increase to the
regional average by 2021 and the UK average by 2031.
● Baseline Self employment rates in Middlesbrough are currently only 59% of
national rates and in the most disadvantaged wards rates are only 44% of national
rates. Middlesbrough Neighbourhood Survey 2005 determined that only 8% of
residents have considered starting their own business.
● Target 10 - The number of residents considering self employment as an option
doubles to 16% by 2021 (needs further refinement).
● Baseline- There is currently an inadequate range of quality accommodation for
the number and variety of businesses in Middlesbrough, thereby acting as an
inhibitor to the regeneration of the town. There is a need to better understand the
property needs of business to be measured by a ‘property satisfaction index’.
· Target 11 – Ensure there is sufficient high quality sustainable accommodation
across the town and in the designated industrial areas that meets the needs of
business and incorporates environmentally friendly building practices. This will be
measured through improvements in the performance of a property satisfaction
index(target to be developed) undertaken every two years
● Baseline- Few businesses are aware of business focused environmental initiatives
in Middlesbrough. Only 12% of small businesses in the north east are aware of the
Government’s organisation Envirowise and only 25% are aware of Netregs- the
Environment Agency’s website based legislation service. Only 29% of North East
businesses recycle paper and packaging waste compared to 35% across the UK
●Target 13 - to increase awareness of Envirowise amongst Middlesbrough’s SMEs
to 50% and of Netregs to 25% by 2016, and increase the recycling rate to the UK
average
● Baseline There is a lack of understanding about certain aspects of the local
economy due to key measurements and appropriate data, such as the rate of growth
of the Middlesbrough economy, not being accessible, together with a need for more
robust mapping of activity and initiatives.
●Target 14 - To better understand the local economy and to access all appropriate
data to ensure that the impact of the strategy can be properly measured and
evaluated, and to undertake ongoing mapping of activity and initiatives to recognise
gaps, to prevent duplication, and to ensure added value is achieved in moving
towards our targets.
3. Hierarchy of strategies
3.1 The Council’s Economic Development Strategy is one of a suite of policies and strategies in place to move forward the regeneration of Middlesbrough. The strategy sits within the broad framework of national and regional policies that endeavour to encourage enterprise and tackle unemployment and
worklessness.
3.2 National Policies/Strategies
Key national policies/strategies include: -
· DTI Business Plan to encourage business and promote enterprise
· Small Business Service policies
· The Department for Work and Pensions (DWP) Five Year Strategy (2005)
· The new Gambling Act which creates the potential for significant regeneration based on the new proposed casinos
· Moving forward: The Northern Way -Middlesbrough lies at the core of the Tees Valley City Region the focus of the Northern Way, the growth strategy for the north of England which aims to narrow the gap in economic performance between the north and the south east
In addition, emerging policy has been signalled in the green paper A New Deal for Welfare: Empowering People to Work (2006), The Department of Education and Skills white paper Getting On In Business; Getting On At Work (2005); and the 14-19 Education and Skills white paper (2005).
This Economic Development Strategy reflects this existing and emerging national policy framework.
3.3 Regional and Sub-Regional Policies
The Economic Development Strategy is linked to regional and sub regional policy initiatives, in particular the work of the Government Office for the North East, One North East (ONE), the Stockton-Middlesbrough Initiative and the Tees Valley Partnership.
The strategy is in accord with the Regional Economic Strategy (RES) which sets
out how the region is going to deliver greater and sustainable prosperity to all people
of the North East over the period to 2016. The Economic Development Strategy also
complements and contributes towards a number of other regional strategies,
including The Regional Spatial Strategy, the land use-planning framework for the
North East to 2016. We will work through the RSS to concentrate development In
sustainable locations, continue the renaissance of our inner urban areas, contribute
to wider sustainable development objectives and to promote policies and
programmes which will develop and promote Middlesbrough’s role at the heart of
the Tees Valley City Region.
ONE with partners is devising a Strategic Action Plan (SAP) for Enterprise and Business Support, which will be published once the Regional Economic Strategy (RES) has been finalised. The SAP will set out how the creation of a dynamic enterprise culture and an accessible business support network will be delivered through one clear model. The aim of the SAP is to generate growth in business start-up rates, particularly among currently under-represented groups, such as young people and women, reflecting an increasingly entrepreneurial and creative culture.
The Economic Development Strategy also complements and adds value to policies
to enhance the Tees Valley City-Region.
The Tees Valley City Region Development Framework builds on the work of the
Tees Valley Vision, a long-term economic strategy for the Tees Valley, which is
designed to raise the economic performance of the Tees Valley, promote economic
and social inclusion and create sustainable communities. The City Region
Development Framework sets out the challenges and an agenda for action that
builds on and utilises the key assets of the City Region, including the two
Universities, evolving cultural and creative sector and the major regeneration
opportunities across the sub region including Middlehaven
Priorities to improve economic performance include:
· Building a strong and diversified economy based on key economic assets;
· Developing sustainable communities;
· Removing barriers to growth, through increasing the business stock;
· Developing UK levels of economic activity, improved skills and reduced levels
of worklessness;
· Developing high quality public transport.
The Stockton Middlesbrough Initiative (SMI) is intended to transform the urban
core of the city-region. A new spirit of co-operation and collaboration between Stockton and Middlesbrough Councils will ensure that the economic prospects of the urban core will be transformed to provide an exciting and thriving working and living environment for generations to come.