Champions Round Table
State of the Economy
Brexit and the Beast from the East at the beginning of the year had a notable effect on the UK’s economy leading to sluggish growth of just 0.2 percent in the first three months of 2018.
While Brexit still looms large, the weather has notably improved and so has the construction sector both locally and further afield and it is experiencing renewed growth.
With this taken into consideration, the UK’s projected GDP growth for 2018 is now 1.3%. However, does that reflect the picture within Chesterfield?
With more than £1 billion of developments in the borough alone currently underway, the town has the opportunity to turbo charge growth in 2018 and beyond.
Hosted by BHP Accountants, this month’s round table, organised by Destination Chesterfield in conjunction with The Derbyshire Times, brought together key figures from Chesterfield’s financial sector to discuss the current state of the economy and the effects and opportunities it may bring to Chesterfield.
AB – Ashley Booker – Head of Content, Derbyshire Times
DS – Dominic Staniforth – Partner, BHP Accountants
SK – Scott Knowles – Chief Executive, East Midlands Chamber
MR – Michael Rich – Executive Director, Chesterfield Borough Council
PB – Peter Blant – Partner, Milestone Financial Planning
The third runway at Heathrow Airport has been given the go-ahead. It will bring wider benefits to other parts of the country, including the East Midlands. How can Chesterfield take advantage of this?
DS – I believe there will be potential benefits during the construction phase as we have a lot of construction companies here in Chesterfield that could potentially be involved.
PB – They’re talking about 180,000 new jobs off the back of the expansion. With the skill set we have in the local area, we could see the direct employment of people working on the airport.
SK – We’ve done a number of sessions with local businesses, in partnership with Heathrow, across the East Midlands. They’re very interested in the supply chain that the East Midlands can bring.
MR – I know there is an active search process underway for hubs to support the Heathrow expansion. The council has been supportive of moves the Chamber and others have made to try and land one of the hubs in the area.
SK – It seems like the Heathrow project is a bit simpler than the HS2 project. The HS2 project is very fragmented, but it seems like Heathrow is a lot more straightforward.
With the ongoing pressures on the retail sector, what can be done to arrest the decline of the traditional High Street?
PB – People’s shopping habits have changed. Town centres could be ghost towns within the next couple of years. If we want to keep the town centre vibrant, we need to go back to the drawing board and think about how we are going to get people into the town centre.
DS – If you go to any European city or town, they’re fundamentally different to how we operate in this country. The main reason being that a lot more people live in the towns and in the cities.
MR – I think increasing residential accommodation in the town is certainly something that can be done to help. Chesterfield is holding up fairly well though. Vacancy rates aren’t as bad as in similar towns. The events programme also helps bring in footfall. We could make a bit more use of the space we’ve got.
SK – Landlords need to be realistic about levels of rents that are achievable. I think Chesterfield has a nice mix of brands and independent retailers and that’s a healthy balance that we’ll need to maintain. I think Destination Chesterfield has played a huge part in terms of stimulating investment in the town centre.
MR – We’re looking at how we can improve the access to the town from the train station. We’re bringing funding in to support improving that access. We need to start thinking more about people arriving by rail as it’s a very poor gateway into the town at the moment. I think Chesterfield Waterside will help with that.
What do you see as the biggest opportunity to the local economy over the next 12 months and how do we maximise the benefits?
MR – It’s great to see developments we have been talking about for a while actually happening and starting to be built. Seeing the Co-op finally being developed is great, there will be more building at Waterside soon and the first phase of Peak Resort will soon begin. Although it does sometimes cause disruption, it’s good to see that things are actually physically happening.
SK – Exporting, specifically international trade opportunities, is a big opportunity for the local economy. Chamber members, at the moment, are proceeding entirely on the basis that we will be trading with Europe in the same way we do today. A lot of our members in Chesterfield and North Derbyshire are now experimenting with new markets. Exporters don’t seem too bothered about the cost of tariffs, it’s more about the delays.
PB – Looking at Sheffield – our big city neighbour, it is great to see how the universities there are attracting Chinese students. The amount of investment coming in from China is tremendous. Now Chesterfield has a University of Derby campus, there is the opportunity for us to capitalise in a similar way, perhaps becoming a centre of excellence.
MR – The University of Derby is really keen to expand its engineering presence here.
SK – The creation of jobs is fantastic, but if you can’t recruit locally and your European workforce isn’t perhaps as available as it once was, where are the employers going to get those resources from?
The challenge across the East Midlands is that unemployment is really low. We’ve got some sectors that have traditionally relied upon a European workforce, particularly for more technical skills.
The Chamber has just published its quarterly economic survey and 67% of our members said that they are looking to recruit but can’t recruit, which is probably the highest it’s ever been. This is a challenge.
MR – We work with large and small employers to support them into the local labour market. I think graduate retention is a huge opportunity with so many big universities on our doorstep and part of that is the offer in terms of the place.
The USA has recently put a 25% tariff on steel imports and other goods and Donald Trump has threatened Harley Davidson if it moves production to another country. Will this affect our export ambitions and attracting inward investment from US companies?
DS – If Donald Trump thinks that putting a 25% tariff on steel imports is a way of punishing the global economy, he’s probably misjudged this. High grade steel exports from the UK amount to about £360 million a year which, in the grand scheme of things, isn’t very much, certainly compared to the export of spirits – the other big industry that might be affected by tariffs.
PB – We’ve got to remember that sterling as a currency is extremely low compared to the dollar, which means exports from the UK will be attractive to China and Asia. I think it’s going to backfire for him in the long-term.
SK – Whether Trump gets re-elected or not, I don’t see that policy enduring because I don’t think it’s economically viable. I think it might just drive people to new markets where they appreciate high quality well-made British products.
MR – Ultimately, we need to support local businesses if they need to diversify and access other markets.
Destination Chesterfield is part funded by contributions from local businesses, Chesterfield Borough Council and the European Regional Development Fund. The project is helping to improve the economic prosperity of the town through a campaign to promote Chesterfield.
The local business community plays a central role in its success by both leading an independent Board of Directors for Destination Chesterfield, as well as businesses pledging their support to become Chesterfield Champions.
For more information about becoming a Chesterfield Champion, visit https://www.chesterfield.co.uk/destination-chesterfield/champions/sign-up/