South London Sub Regional Economic Assessment · 1/ South London Sub Regional Economic Assessment:...

South London Sub Regional Economic Assessment

2010

For the South London Partnership

Early Draft for Consideration by Partners

Under no circumstances should any part of this document be used or

quoted without permission

Team:

Kingston University

Dr P. Garside

Professor Sarah Sayce

Billy Clements

Kingston College

Peter Phipps

South London Business

Alena Harvey

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1/ South London Sub Regional Economic Assessment: Introduction

1.1 An Introduction to the South London Sub Region (SLSR)

The sub-region is defined as the seven London Boroughs of Bromley, Croydon, Royal

Borough of Kingston upon Thames, Merton, Richmond upon Thames, Sutton and

Wandsworth (Figure 1.1).

Figure 1.1 The SLSR within the London City Region.

Source: CERI, Kingston University

For many years the SLSR has been viewed as part of the Outer London belt which has been

characterised as:

“On most indicators, Outer London is healthier, wealthier and greener than Inner London and

indeed most urban areas in the UK. Its residents overall are highly satisfied with life in their

neighbourhood, but would like to see improvements on some very local environmental

issues, including crime, litter and anti-social behaviour.” 1

This localised caricature has dominated the discourse defining the SLSR for several

decades and has reinforced both the image and the function of the area, within the wider

regional economy, as a residential dormitory provider of highly qualified senior and

managerial staff. Ultimately, this perception has simultaneously reproduced the highly

centralised development patterns of the broader city region (which includes the Outer

Metropolitan Area – OMA2) and reemphasised the associated notion that the separate Outer

London economies are concealed around localised retail and public services.

1 GLA 2007 Outer London: Issues for the London Plan

http://static.london.gov.uk/mayor/strategies/sds/london_plan/outer_london_issues_lon_plan.rtf 2 GLA Economics: Economic Evidence Base to support the London Plan, the Transport Strategy and

the Economic Development Strategy, 6.

http://static.london.gov.uk/mayor/strategies/sds/london_plan/outer_london_issues_lon_plan.rtf

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This (highly dominant) stereotype has, over the last five years, been challenged through

responses to the draft London Plan, the development of Sub Regional Development Plans

and a more critical academic understanding of the complex nature of the Outer London

economy3. This movement has lead to the production of the Mayor‟s Outer London

Commission report4 which provides a more holistic understanding of the outer London

economy and attempts to offer a less centralised development scenario than has previously

been advocated for the city region. However, this is only a small step against decades of

growth based upon unsustainable processes of development, which the report fails to fully

acknowledge in terms of the possible consequences.

Figure 1.2 Adapted Key Diagram for the London City Region


The actual SLSR is artificial in construct and as such it is not a self-contained sub-region. It

has a long and varied history of development that underpins its contemporary linkages,

mostly based upon the urban sprawl of London subsuming previous county towns, producing

the now metropolitan centres, spill over residential estates and linear growth patterns along

radial transport routes. As part of the wider city region it is no surprise there are significant

labour market, business, leisure and educational linkages with adjoining areas. South

London functions within London‟s wider central area and is influenced by proximity to central

3 Gordon, I (et al - LSE) (2009) London‟s Place in the UK Economy 2009-10 published by the City of

London. 4 http://www.london.gov.uk/olc/questions/final-report.jsp

http://www.london.gov.uk/olc/questions/final-report.jsp

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London and the city. It is also influenced by the western corridor, London Fringe, M25 towns,

Gatwick corridor, Thames Gateway, Surrey and Kent.

Figure 1.2 shows the linkages and corridors that are determined to affect the area from a city

region perspective and the structural make up of all the sub regions. But this is based on

current wisdom that tends to reinforce the centralised flow patterns that historically have

created the current unsustainable circumstances.

Whilst the population of the area has increased since 1990 by 180, 000 (from 1,513,900 to

1,693,900) relative to London as a whole the area has witnessed a slight decline in terms of

its population as a percentage of the wider region (from 22.3% in 1990 to 21.8% on 2009).

This is primarily due to higher growth rates in central London and indicates that the area has

generally maintained a growth rate broadly in line with the rest of the region. However, this

simple regional comparison masks a wide variety of more complex demographic issues

within the area as displayed in Figure 1.3 and which will also be illustrated later in this report.

Figure 1.3 Characterisation of the Population within the SLSR


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In terms of previous work that has been undertaken to characterise the economic structure

of the SLSR5 there is a reasonable consensus on its strategic areas, but certainly not on its

development capacity.

“South London‟s key strategic areas are the Wandle Valley running through the centre of

the sub-region, the River Thames to the north and west, Crystal Palace, the metropolitan

centres of Bromley, Croydon, Kingston and Sutton and town and district centres.”6

The detail of these locations and the specific development sites within the area are shown in

Figure 1.4. This is an attempt to represent the sum of the parts of the sub region by visually

bringing together the respective sites and assets the area has to offer. It also represents the

infrastructure within the area and is very much a characterisation of the different locations.

However, this is also a very static picture of the sub region and does not reveal the full

nature of the linkages and flows through the area. These are explored through the various

sections within this assessment, because they are as equally important for understanding

the existing economic processes at work in the area, as they are for defining the future

challenges of the area and the wider region.

Figure 1.4 Key Strategic Areas with the SLSR


To supplement this overview of the sub region a wide range of local documents were

examined to assess the key issues facing each borough council. These were collated and

5 South London Partnership: South London Sub Regional Prospectus, Sub regional Development

Plan, Sub Regional Economic Development Implementation Plan (with Action Plan) and the Overview of Key Issues Facing South London (for the Outer London Comission). 6 South London Partnership: South London Economic Development Implementation Plan.

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synthesised into a key issues matrix (Appendix 1). This level of detail is not appropriate to

include in the main text, however it clearly demonstrates the commonalties and differences

across the sub region, mainly in terms of the vulnerability of the area and its perceived

potential. The main issues are:

Economic

High levels of economic activity – all LAs above GL average

Public sector (Health particular) and consumer services employment important

contributor to economy

Diversity of occupation/economic base

Importance of retail (consumer services) throughout sub region – Key met. centres of

Kingston, Croydon, Bromley with network of smaller district and local centres –

economies

Industrial base to economy remains a key asset (Wandle belt)

Importance of leisure/visitor economy sector to local economies

SMEs constitute a major proportion of economy at LA level

o Growth of SMEs in financial/business services sector (pre-recession) and

creative industries (increasingly media) - environmental sector seen as potential

growth sector due to reputation

o Self-employment levels run relatively high throughout the sub-region

o Use of business support networks varied

Loss of large corporates to London and South East (e.g. Surrey) an issue

Lack of established commercial/industrial clustering – indistinct commercial identity

Healthy enterprise and entrepreneurship levels (based upon VAT reg/dereg) and high

levels of self-employment

o Varied longer term survival rates

Employment and Skills

Low workplace based earnings/higher resident earnings

Outcommuting (outflow of labour) particularly higher skilled residents

o Lack of high skilled positions (senior and management) to retain high skilled

residents – losing to Central/West London boroughs

Local variances in labour skills – large gaps between high skilled residents and identified

pockets of low skills base, deprivation and unemployment

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High proportion of lower skilled jobs within the sub-region

Practical skills gaps identified by local employers in some areas (Business Surveys)

Infrastructure and Linkages

Need improvements in transport infrastructure to support economic prosperity of the sub-

region (both into London, cross sub region and orbital)

o Where strong transport infrastructure is in place (Richmond, Merton) seen as a

major asset

Building on links with major transport networks and facilities – Gatwick, London

Underground, Biggin Hill

Important potential of linkages with South East (Surrey, Kent), M25/M4 areas and the

Gatwick triangle (identified high growth areas) – both physically and economically

o Identification of upstream/downstream supply chain linkages with these areas

Land Use and Property

Loss of employment land to other development (particularly residential uses)

Lack of new, quality commercial accommodation (particularly office) with low grade

ageing stock suffering from vacancy as unsuitable for SMEs

Lack of new industrial accommodation in the sub-region (apart from some areas) to

support this sector

Limited available supply of employment land in some areas with uncertain pipelines set

against potentially large scale development pipeline sites depending on site access and

infrastructure development

1.2/ A Brief Word on the Nature of this Economic Assessment

Due to the institutionalised nature of the manner in which data sets are produced and the

geo referencing which ties data to existing administrative and political geographies there are

no data sets which easily align to the true functional economic geography of any area.

Therefore whilst the spatial geography of the South London economy can be described it is

not possible to support all aspects of its „true‟ economic geography with specific primary

quantitative data. Therefore, in certain cases, qualitative data, based upon expert opinion

and profession experience will be used to inform our story of place. These are represented

here as fairly and as accurately as possible and provide a valuable insight into not just the

area itself, but also the aspirations stakeholders have for the sub region.

The contemporary circumstances of the South London economy are intrinsically embedded

within its historical development, its proximity to a wide range of economic markets, its

accessibility and the previous visions/interventions of different policy and business

communities. This is important to state, because no matter how objective assessments and

data are deemed to be, due to the methodology and the implicit need of the work undertaken

it will always present a skewed or partial version of „reality‟ and be used as part of a

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vision/place making narrative which will inherently become part of its development process.

Therefore whilst the aim of this assessment is to reveal the existing economic circumstances

of the sub region, the limitations of the data and the potential political interpretation of the

narrative are noted.

In addition to this there is also the challenge of distinguishing between what are the existing

economic circumstances and what could be considered the development capacity of the

area. This is a fundamental distinction, yet also essentially interlinked, because the future

potential of the area is based upon an interpretation of the existing trajectory of the area.

However, how this trajectory is measured and how this is interpreted is highly subjective

depending upon the aims and needs of those making the interpretation. This needs to be

understood in relation to those who have already told the story of South London and what

this means in relation to the conflicting interpretations of the development capacity of the

area.

Therefore, the fundamental approach of this assessment is to articulate the current state of

the sub region in terms of its economic position and development and by doing so to define

both the capacity of the area for future development and the flows that substantially link the

area (or parts of it) to other locations that are part of the wider functioning spatial networks

within the South East. This is undertaken within a context of examining the future

sustainability of the city region, which critically questions the centralist vision of

contemporary urban planners and policy makers, whilst considering alternative development

scenarios for the sub region.

In terms of what is meant by economic, this assessment takes the view that within a

developed capitalist society, all forms of development have an inherently economic

component or influence to them. Therefore, it is essential to consider as wide a range of

potential influences on the development of the area as possible, but simultaneously to make

sure that it is interpreted or represented at a sub regional level. Ultimately, this means that a

judgement call has been made on certain issues as to whether they have influence at this

level and therefore warrant inclusion.

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2/ Review of Key Themes from Regional Strategic Reports

This section critically explores the views and perceptions of the sub region that have

emerged from the regional perspective: GLA. This is particularly important because the bulk

of the analysis examined here is used to legitimise and validate the objectives of the London

Plan, which present the economic trajectory of the sub region in a very defined and

interlinked manner with that of the wider region. This not only sets the context for the

development of the sub region, but for future attempts to change its development. Therefore,

it is essential to unravel the basis of these objectives to reveal any contradictions or

misinterpretations about the sub region, and to reflect on the motives and sustainability of

the regional ambition for the area.

2.1/ Commuting

The key findings below are taken from the GLA‟s Working Paper 36 “Commuting patterns in

London by qualification level and employment location” (Ennis, N, et al 2009) and reflect the

existing problems with regard to travel to work patterns for not just South London but London

as a whole.

The report shows that for any given place of work, employees in London with no

qualifications travel shorter distances to work than people with high qualifications. The

distance travelled varies by place of employment, with the largest centres drawing

employees from the largest geographic area. So employees with no qualifications working in

Central London generally travel further than employees with high qualifications working in

many Metropolitan Town Centres.

As a result employment profiles for the boroughs in South London also indicate that those

with no and relatively low qualifications tend to travel within their local catchment areas. But

within the high cost boroughs where the level of workforce with this qualification profile is

relatively low, there is a tendency to draw from a catchment area that spills over into

neighbouring boroughs. As a result places such as Kingston, Richmond, Wimbledon and

Bromley provide an inward commute for low qualification workers from Spelthorne,

Hounslow and Bexley.

Figure 2.1

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Source: Census 2001

This is also confirmed by the core strategies for these areas and as Figure 1.1 shows, it is

very much within the centre and north of the sub region where the highest percentage of

people travel short distances to work and that around the key centres there are clear areas

where this type of commuting does not happen for these local residents.

The smallest town centres appear to draw employees only from the immediate surroundings,

which may indicate that small centres have only local impacts. Employees are likely to travel

the furthest distance to work when there are relatively few other opportunities available

locally.

This is true at all skill levels but particularly for jobs requiring high qualification levels there

are very few locations with large numbers of suitable jobs, so these employees are most

likely to travel furthest to work. In this case, only the Thames Valley competes significantly

with Central London for employees, so a relatively smaller share of residents there commute

to Central London.

As a result, the commuting patterns for those areas, such as South London with a relatively

high proportion of highly qualified employees, are extremely skewed to longer commute

times. The result of not creating suitable jobs for these workers in a more distributed pattern

has obvious affects on not just their quality of life, but the wider environment and restricts

more diverse local economic development.

This long distance travel is illustrated by Figure 2.2 which clearly shows the high impact in

places such as Bromley, Wimbledon and Richmond.

Figure 2.2

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Source: Census 2001

The commuting research carried out by the GLA also revealed that the relatively few jobs

filled by those with no qualifications are spread round London fairly evenly, apart from a

large concentration in Central London.

2.2/ The Retail Industry

At sub and regional perspectives the existing and future development of the retail industry is

essential to many large and small scale centres. Particularly for the Metropolitan centres in

South London that for a long time (apart from Croydon and Wandsworth) have seen very

little development. Even in the centres where development is taking place (which has stalled

in many cases due to the economic downturn), competition in other parts of the region and

the South East will at best have a stifling impact on their future role.

The findings and observations outlined below are taken from the most recent GLA report

“Consumer Expenditure and Comparison Goods Retail Floorspace Need in London”

(GLA/Experian 2009).

Table 2.1

Top 20 Retail Centres in London 2006

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Source: GLA/Experian 2009

As can be seen from the table, of the top 8 centres in London half are located in South

London (or of the top 10 half are located in South London). This alone shows both the extent

to which the development of the area is dominated by this section of the economy, and its

contribution to the wider London economy.

In addition, the GLA report also maps out the retail catchment areas of the key centres and

these are shown in Figures 2.3-2.6. This shows the extent to which the economies of these

centres is embedded within their surrounding areas, stretching far into the South East along

major arterial transport routes and merging with the catchment areas of associated and

adjoining urban areas.

Figure 2.3

Kingston Retail Catchment Area

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For Kingston this shows the extent of the northern barriers to its reach, impacted upon by the

West End and the CAZ, including the physical restrictions of the River. It also reveals the

other barrier catchment areas that have impacted upon its development in terms of Reigate,

Guildford and Staines, the latter of which has more than doubled its retail floorspace in the

last 6 years with the Two Rivers centre.

Figure 2.4

Croydon Retail Catchment Area

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The extent of the Croydon catchment area clearly shows its northern boundaries which finish

short of the River, curtailed by more centralised activity areas, and the extent that it flows

down towards Crawley over the M25, drawn by the major arterial road and rail networks in

between Sevenoaks and Reigate.

To the east the boundary is marked by Bromley, however to the west, even the Secondary

area overlaps and obscures the catchment area of Sutton.

Figure 2.5 reveals the size and extent of the Bromley catchment area and the high level of

competition it exhibits with Croydon, and the Sevenoaks areas, which tend to curtail its

secondary catchment areas.

However, it also shows the south eastward spread of this catchment area due to the limited

nature of existing competition and the limiting impact of Bluewater and Lakeside in the north.

Something which needs to be considered as part of future trends.

Figure 2.5

Bromley Retail Catchment Area

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Figure 2.6 shows the extent of the catchment area of the fourth largest retail centre in South

London: Sutton.

Its primary catchment area is very elongated, squeezed in between Kingston and Croydon,

following the major arterial north to south routes down as far as the M25.

As with the case of Croydon the secondary catchment area also overlaps this location and

once again reveals the high level of competition between these centres within the sub

region.

Whereas the competition with Sutton (in terms of other town retail centres) outside of

London is defined by the limit of its secondary catchment area coming into contact with

Reigate.

Overall, these very historic centres have grown up over a long period of time and become

part of the wider London geography; however their catchment areas reveal their long term

relationship with the communities in Surrey and Kent.

The main problem, according to the GLA report which defines these centres, is that growth

in these areas is set to stop and in many cases the centres will start to lose their rankings,

due to increased competition from development within London and the South East.

“We see White City and Stratford rising up the turnover ranking as a result of their

developments. Only the positions of the West End and Kings Road East are unchanged and

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the remaining centres‟ ranks fall as a result of the increased turnovers of the expanding

centres.” (GLA/Experian 2009).

Figure 2.6

Sutton Retail Catchment Area


In addition the report also stresses that diversion from Greater London to the South East is

already a major sales driver for centres such as Bluewater and Lakeside and, to a lesser

degree, town centres such as Reading and Guildford.

Of all the retail catchment areas that have been analysed there are clear predictions of

growth for many central and new centres, but in the predicted period over the next 20 years

the forecasts show no change in the catchment areas of South London centres.

Therefore, from the GLA‟s interpretation of the situation the retail situation in South London

is potentially very vulnerable, being exposed to high levels of competition, irrespective of

changing shopping mode patterns, reflecting a stagnant growth area with falling rankings.

Considering this is one of the cornerstones of the South London economy, supporting not

just a vast array of businesses, but indigenous and diverse employees (including low and no

qualification workers), the impact of a decline in this sector will not only have a

disproportionate affect on this sub region, but on the most vulnerable sectors of the labour

market within it.

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2.3/ Office Based Growth

The London Office Policy Review 2009 (GLA/Ramidus) outlines the key pressures and

potential development issues for office accommodation in the region and is one of the key

strategic documents informing the draft replacement London Plan.

The report outlines the cyclical and structural changes taking place in the office market place

and defines their impact on new and existing office centres.

In terms of cyclical issues the reports defines:

the impact of the recession,

the rental and yield adjustment,

the fall in output-related demand

the development downturn

In terms of general structural changes these are defined as:

the impact of financial supervision reforms on London‟s finance markets;

London‟s reputation as a global finance centre resulting from recent events;

the threat from other global centres and central government policy, particularly the

tax regime.

However, the report also goes on to highlight very particular structural changes that are

having a spatial impact:

“Actual structural changes underway that are already changing the dynamics of the London

office market. In this category we include the emergence of a polycentric office market in

Central London, which has implications for Outer London (OL); the impact of policy vis-à-vis

an eastwards drift; the increased marginalisation of large numbers of OL centres (in purely

office market terms), rationalisation in the public sector and new working patterns. The latter

two are summarised here. We regard the twin trends of property rationalisation within the

public sector and the growing acceptance of flexible working styles as key to the changing

profile of demand within, and throughout, London.

The public sector, one of the largest occupational sectors, is now planning its occupation of

office space in ways that would not have been envisaged as little as five years ago. Bearing

in mind the scale of public sector jobs both in central and local government throughout

London, the impact on local markets could be significant. Many of these are heavily reliant

upon the public sector to underpin their already fragile office markets, and shrinkage therein

is likely to have a disproportionate impact in locations which might be considered marginal in

commercial terms. Growing numbers of organisations are adopting new working patterns.”

(GLA/Ramidus 2009).

In affect future demand is changing due to the efficient use of space and the overall reduced

need for it. What is happening is a structural change in which the second most expensive

cost for most organisations is managed far more responsibly than has typically been the

case in the past. Traditional assumptions about the growth of employment and the

associated growth in employment space will need to be re-visited.

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All of these changes have direct impact in terms of a long term reduction in demand for

office space, particularly in marginal employment centres. But this is on top of the decline in

relocation opportunities which in the past did define the relationship between the centre and

outer London areas, including the relationship with the OMA.

For example, the degradation of Central London salary weightings together with the

decimating impact of technology on back office functions has led to a massive reduction in

the relocation market to these areas. What is left of the relocation market today mainly seeks

a low cost regional centre, or moves offshore.

In addition to this impact, the report not only outlines the overall degradation of the office

sector across outer London but the increased competition from mega developments and

office campuses than have emerged (and are emerging) in central London.

Current mega schemes have a potential pipeline of 4.23 million sq m; which compares to 2.3

million sq m delivered in mega schemes over the past 25 years. In percentage terms, the

largest growth is projected for Hammersmith & Fulham, Tower Hamlets and Newham,

reflecting the development of new office centres. The smallest growth is projected at

Croydon, Kingston and Sutton. Croydon has a comparatively large office stock but a large

proportion of the occupier base lies in sectors that are forecast to have weak demand, such

as public administration. Ultimately, it is anticipated that the mega growth schemes will

curtail any future centripetal drifty to outer London.

Central London has become a polycentric office market, with large off-pitch office campuses

in places such as Broadgate, Canary Wharf, More London and Paddington. Such centres

provide a rent discount, Grade A buildings, public realm and support services. It is believed

that these campuses have soaked up demand that might otherwise have leapfrogged further

to traditional outer London centres.

Table 2.2

Office Market Assessment Grid for South London

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Source: GLA/Ramidus 2009

As can be seen by the table, it is fairly obvious that the potential for office market growth in

South London, according to this review, is extremely limited and many places might see a

real decline. This is mostly based on the lack of strategic sites, poor infrastructure and

limited pipeline.

Overall this report reaffirms a centralist policy and the status quo type development that is

already underway, generally reducing the need or significance of outer London employment

centres and undermining their ability to stake a claim for this type of market. But this can be

a self fulfilling prophecy and the negative impact of this on the environment and the long

term sustainability of these centres are not explored. This therefore offers a very limited

interpretation of the wider contextual issues or the actual potential capacity issues that need

to be addressed to provide an alternative set of scenarios to this centralist interpretation.

In addition it does not consider the weight of significance if the inevitable form of status quo

development is actually allowed to take place, not just in hard economic terms but in all

respects related to social and environmental concerns. If anything it certainly highlights the

vulnerability of spaces and places in South London and the increased need for future

intervention to keep these areas being net contributors to the regional and national

economy.

2.4/ Industrial Land and Capacity

The Industrial Capacity London Plan (Consolidated with Alterations since 2004)

Supplementary Planning Guidance (2008) once again as with many other major documents

informing the London plan alludes to the vulnerability of the South London sub region.

The guidance highlights the wide geographical variations in the demand and supply balance

across London, across its sub-regions (as identified in the London Plan) and within

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boroughs. This is due to constraints on the quality, availability and nature of the current

supply, which means there may be local shortfalls in quality modern floorspace and readily

available development land, particularly in parts of West and South West London.

The guidance also clearly notes the historic decline in manufacturing but indicates that this

decline is slowing and that in many areas innovation and technological advancement are

producing a demand for the „right type‟ of industrial area. This demand is derived from a

competitive wealthy regional market and specialisation as industries move towards the

production of higher value goods or become more closely associated with services such as

those with an emphasis on research, catering or the leisure market.

In terms of this demand pattern, it is clear from the guidance that this has and will continue

to impact in spaces and places that still have a manufacturing base and those places that

are showing signs of innovation and specialisation. From the manner in which the vacancy

rates are recorded it is apparent that South London is key to this continued demand, even

though the report considers capacity to lie elsewhere.

The 2006 industrial land estimate for London includes 706 hectares of vacant land, an

average vacancy rate of 12.7 per cent, which is a reduction from the rate of 14.7 per cent in

2001. The highest subregional rates of vacant land are found in North East and South East

London (17 and 16 per cent respectively) and the lowest in South West London (4 per cent).

As a result the guidance considers it essential that, particularly, the South London sub region

should be designated as restricted when it comes to the transfer of industrial land to other

uses.

The research supporting the guidance concludes that within London three of the main areas

requiring additional growth capacity directly affect the future of the South London sub region:

Wandle Valley, Heathrow and the M4/A4 corridor and the Vauxhall Nine Elms Battersea

Opportunity Area. This is based on the change in logistics, demand for waste management

land and the growth in specialised manufacturing/services related industries.

Therefore, it is clear that in terms of industrial related business patterns the South London

sub region is a viable economic sub region and the key issue for managing this is derived

from understanding and adapting its capacity. This is a common theme in many of the

strategic documents that discuss the future of South London and something which is far

more open to intervention from the policy realm than many other driving factors.

2.5/ Central Gravity and Growth Areas – Challenging the Status Quo?

Many documents, strategies and reviews that have been produced by the GLA clearly

emphasise the importance of central growth and the potential growth of new key locations.

The Economic Evidence Base – October 2009 version to support the public consultation

drafts of the London Plan, the Transport Strategy and the Economic Development Strategy

states very clearly that:

“The development of London‟s radial public transport network has enabled the growth of

Central London by reducing the cost of accessibility to a significant proportion of the region‟s

population. Figure 2.3 shows that much of Central London can be reached on public

transport within 45 minutes (minimum journey time) by over 1.5 million people. This shows

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that the potential workforce for Central London is much greater than that for other parts of

London. Indeed a similar picture is portrayed if the number of jobs accessible to residents

within 45 minutes is considered (see Mayor‟s Transport Strategy, Figure 77). It also

suggests that the access that businesses have to markets (either other businesses or

people) is greater in Central London than elsewhere in London.” (GLA/Economic Evidence

Base 2009).

This coupled with the perceived need to provide housing and link this to accessible business

growth inevitably means that:

“The capacity for future housing growth is primarily located in parts of East London where

there is a significant amount of redundant employment land. It is important that any housing

developments are linked to areas with employment opportunities which, as shown earlier,

means particularly Central London.”(GLA/Economic Evidence Base 2009).

GLA Working Paper 31 “Employment in London by firm size” also emphasises the

significance of central London firm development as it highlights the importance of centrally

based large sector organisations:

“The combined data also shows that 60 per cent of employment in London is in either a large

private sector enterprise, a large public sector organisation or a large non-profit

organisation.” (GLA/Prothero 2008).

The report defines in detail the significance large scale, predominantly central London

employment, particularly the 1,365 private sector enterprises that employ at least 250 people

within London (including the 110 ultra large London employers), as they are responsible for

49 per cent of London‟s total private sector employment.

This centrality and growth area significance is further highlighted by studies of specific

sectors that are seen as critical to the London economy, such as the logistics sector

(Working Paper 37, GLA/Thompson 2008). This sector is seen as an essential element in

the stable functioning of the London economy and has potential to grow to accommodate

planned growth patterns.

In South London those wards that have a high index of specialisation are not clustered

together in the same way as elsewhere in London and are dispersed across a number of

boroughs.

The same is less true in Inner London with Queenstown in North East Wandsworth having a

particularly high index of specialisation for logistics employees. This is understandable given

a number of prominent logistics locations there are such as New Covent Garden market and

a concentration of courier and postal services.

However, the significant growth issues that are envisaged in this sector are once again

driven by the wider development plan for London:

The approval of London Gateway, DP World‟s proposal for a Deep Sea container

Port alongside Europe‟s largest logistic park in the Thames Estuary just over the

border of London in Thurrock;

Proposed new rail-freight handling terminals in the Greater South East. Locations

include Howbury Park in Bexley, recently approved at inquiry, and Radlett in St

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Albans, where plans were refused by the local authority but have recently been

resubmitted;

Interest by operators in using land at London Riverside for rail-based freight and

associated logistics including the potential to deliver a high speed rail freight facility

linked to High Speed 1 (Channel Tunnel Rail Link (CTRL).

And all of this does not take into account the widely debated centralised programme of

development defined in the London Plan, which clearly accepts an inevitable pattern of

development based along the lines of continued, unsustainable, existing trajectories. The

notion of flood plain/estuary development and increasing commuter numbers set against an

understanding of climate change is something that needs to be fully explored, within a

context of providing viable alternatives of localised development around existing local

economies with increasing diverse development.

This is something that has been raised as part of the Outer London Commission (The

Mayor‟s Outer London Commission Report 2010), which has certainly gone some way to

address the balance of the debate by highlighting the issues of:

making the most of existing places

strategic outer London development centres

greater interregional working and corridor development

releasing the barriers to growth – particularly transport

But above all it is significant for actually raising the question/challenge of how to tackle the

unsustainable long term problem inherent in existing approaches to development and how to

make:

“London‟s „spatial strategy‟ more effective in coordinating investment beyond its traditional

land use, transport and environmental areas of concern.”

In addition the Outer London Commission concluded that in terms of business capacity and

growth potential, close location to international transport hubs will increasingly be a factor:

“Access to international transport links is an important factor in businesses‟ locational

decisions, and airports will remain an important economic driver in outer London (particularly

perhaps in west and south London).” (Outer London Commission 2010).

Figure 2.7

Density of origins by LAs for all SE Airports

22

Source: GLA/Ennis – Come Fly With Me: Airport of Choice in Greater London

Which considering the linkages and use patterns for airports across the South East, as

shown in Figure 2.7 (which does not include potential Biggin Hill development), it is fairly

clear that the South London sub region is positioned particularly well to take advantage of

this growth potential, if other transport and capacity factors were to be addressed.

However, the statements of the Outer London Commission are a very small scale challenge

to the mainstream wealth of documents, reviews and strategies (including the London Plan)

that reinforce and reproduce the concepts and belief that any form of „radical‟ change in

thinking, let along policy implementation, to the traditional/status quo growth for London are

unviable.

It is as much the weight of literature as it is the language used which tends to reinforce the

basic notion of centrality, as there is little by the way of evidence or review that considers the

negative aspects of this approach, particularly with respect to climate change and the reality

of trying to engender sustainable communities. To truly consider an alternative set of

development scenarios that challenge the status quo, a far more enlightened and balanced

approach to sub regional development needs to be considered, starting with exploring the

issues raised by the OLC in a wider context.

23

3/ Key Economic Indicators

3.1/ The Structural Composition of South London

The data in Appendix 2 represent the detailed economic structure of the sub region, its

employment structure, the location quotients of all its industries and its level of GVA

generated within the South London Sub Region from 1995 to 2007. They clearly show that

within London and the South East out of the 19 sub regional economies it is in 15th place in

terms of per head and index based figures. This highlights the incredibly vulnerable nature of

the sub region, not just within the London area but also within the wider South East.

Of the 629, 242 people employed within the area the detailed employment data in Appendix

2 also reflects the bi-polar distribution of the employment sectors within the sub region,

revealing the dominant sectors: retail, education, public admin, health, social work – but also

the dominance of employment activities7, computer consulting and construction for Male Full

time employment and the food and beverage groups for the Part Time workers.

The quotients in Appendix 2 reveal the structural strengths of the SLP area as they compare

its structural composition with the surrounding economies of London, Outer London and the

OMA. This does not reveal the size of the sector within the area rather the density of this

type of employment as a comparative advantage to other areas.

Here the data show the quotient scores are above 2 for creative, arts and entertainment

activities and for insurance, reinsurance and pension funding, except compulsory social

security. Whilst these are not key employers only employing just over 3300 and 4900

respectively, they do reflect the uniqueness of the SLP economy set against other peripheral

economies within the London City Region.

Perhaps more significant, set against the OMA, are the key employers that are concentrated

within the area:

Social work activities without accommodation

Public administration and defence; compulsory social security

Employment activities

Services to buildings and landscape activities

7

Employment

activities

78.1 Activities of employment placement agencies

78.10 Activities of employment placement agencies

78.10/1 Motion picture, television and other theatrical casting

78.10/9 Activities of employment placement agencies (other than motion picture, television and other theatrical casting) n.e.c.

78.2 Temporary employment agency

activities

78.20 Temporary employment agency activities

78.3 Other human resources provision

78.30 Other human resources provision

24

Whereas there are less significant key employer differences between SLP and the Outer

London area expect for architectural and engineering activities; technical testing and

analysis.

As expected there are slightly less significant differences between the SLP economy and the

total London economy, but where these do exist there is a particular representation of

manufacturing industries in the sub region and in terms of key employers the main

differences are:

Sports activities and amusement and recreation activities

Residential care activities

Specialised construction activities

Other personal service activities

And finally there are even less differences between the SLP area and its buffer zone

(adjoining authorities in London, Surrey and Kent), but once again where they do exist there

is a significant representation of manufacturing in the sub region and in terms of key

employers the main representation is in:

Security and investigation activities

Residential care activities

Sports activities and amusement and recreation activities

Possibly the most significant areas that define the SLP area within the city region are its

manufacturing industries, with quotients of 1.8 – 1.9 (depending on the sector), and whilst

they may be low scale employers they are uniquely different to the rest of the City Region

irrespective of which general areas are used for comparison.

The detailed figures for the employment analysis in the Appendix also reveal the dominance

of part time employment within the sub region, which in comparison to other adjoining areas

and even national trends, is another aspect of the area which displays its vulnerability.

The rest of this section outlines the broad economic indicators for the sub region and

demonstrate in general terms the strengths and weaknesses, but mostly the changing

character of the sub region. At a general level it is possible to see how some of the

weaknesses displayed have become more defined over the past decade, due to both

structural and cyclical changes.

3.2/ Basic Workforce Issues

Figure 3.1

25

Source: ABI

Figure 3.2

Source: ABI

As Figures 3.1 and 3.2 show, over the last 10 years, the actual employment number for full

time workers within the SLP area has remained fairly consistent whilst trends for the

surrounding areas have moved more in line with economic fluctuations. This consistency of

employment is particularly reflected in the number of part time workers within the area which

continued to grow throughout the period, whilst surrounding and adjoining areas recorded a

clear decline in 2000 and 2006.

This level of consistency (slight decline) in full time workers and constant increase in part

time workers is clearly displayed in Table 3.1.

Table 3.1

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

Axi

s Ti

tle

Full time Workers

London

South East

SLP

OMA

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

Part Time Workers

London

South East

SLP

OMA

26

Full Time Workers

Area 1998 2008 change

London 2,890,048

3,080,196

190,148

6.6

South East 2,353,162

2,593,534

240,371

10.2

SLP 436,690

429,778

-6,911

-1.6

OMA 1,820,905

1,953,845

132,940

7.3

Part Time Workers

Area 1998 2008 change

London 874,028

1,088,332

214,303

24.5

South East 1,071,922

1,164,178

92,255

8.6

SLP 158,051

199,698

41,647

26.4

OMA 798,397

872,193

73,796

9.2

Source: ABI

In terms of employment growth within the area it has all been due to an increase in part time

employment, which has seen a steady increase across this decade, far more so than

surrounding and adjoining areas.

Figure 3.3 highlights the changing (or not so) economic structure of the SLP area during the

decade 1998-2008 in terms of full time workers broken down by broad industrial

classification.

As can be seen the area is dominated by a reliance on financial services, which over the

decade saw a decline and then revival toward 2008. Therefore, considering the economic

impact of the most recent downturn it would be fair to assume that current employment rates

in this sector stand at somewhere equivalent to their 1998 figures. Over this period there

was also a significant percentage growth in public sector services, whilst retail and the

leisure service sectors, witnessed a significant percentage decline in terms of this sectors

contribution to full time employment within the area. This demonstrates that over the last

decade the area has become even more reliant on Public Administration, Education and

Health, witnessing a decline in Distribution, Hotels and Restaurants, whilst its third main area

of employment (Banking, Finance and Insurance) has remained fairly static.

Figure 3.4 shows the percentage break down for the employment levels in the SLP area for

2008 set against those for surrounding and adjoining areas for full time workers. The obvious

issue highlighted by these statistics is how much more the SLP area relies upon its Public

Administration, Education and Health employers than its surrounding and adjoining areas.

Also that the Banking, Finance and Insurance sector is still a significant employer within the

area in comparison to other surrounding and adjoining locations, particularly in comparison

to the OMA and broader South East region.

Figure 3.3

27

Source: ABI

Figure 3.4

Source: ABI

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Economic Structure of SLP Area Full time Workers

Energy and water

Manufacturing

Construction

Distribution, hotels and restaurants

Transport and communications

Banking, finance and insurance

Public administration,education & health

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

London South East OMA SLP

Comparative Economic Structure 2008 Full time Workers Other services

Public administration,education & healthBanking, finance and insurance



Construction

Manufacturing

28

Figure 3.5

Source: ABI

Figures 3.5 and 3.6 show the economic structure within the area and comparatively with

other locations for part time workers.

This presents quite a different scenario for the area and it is significant due to the increasing

dominance of this type of employment within South London.

Distribution, Hotels and Restaurants witnessed a decline in part time employment over this

decade, whilst Public Administration, Education and Health saw a minimal rise in part time

employment relative to the other sectors within the South London economy. Even though

Banking, Finance and Insurance part time employment went through two peaks during this

period (2000 and 2004), its percentage contribution to the employment levels in the South

London economy remained fairly static during this ten year period.

Comparing the percentage breakdown of part time employees with surrounding and

adjoining areas (Figure 3.6), it appears that in terms of the main employment sectors the

SLP area closely represents a mixture of the of the wider South East and London economic

structures, with a similar reliance on employment within Distribution, Hotels and Restaurants

and Public Administration, Education and Health, but still a slightly higher dominance of

Banking, Finance and Insurance part time employment.

Figure 3.6

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Economic Structure SLP Area Part time WorkersEnergy and water

Manufacturing

Construction




Public administration,education & healthOther services

29

Source: ABI

3.3/ Basic Firm Structure

Figure 3.7

Source: ABI

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

London South East OMA SLP

Comparative Economic Structure 2008 Part time Workers Other services

Public administration,education & healthBanking, finance and insurance



Construction

Manufacturing

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Total Number of Firms in SLP Area

London

South East

SLP

OMA

30

Figure 3.7 presents a very basic overview of the actual number of firms at a comparative

range of spatial scales to demonstrate the growth rate (or not) in terms of actual firm units

within the SLP area. As can be seen the growth rate in the SLP area in comparison to the

surrounding and adjoining areas is much less in terms of actual numbers of firms across the

decade from 1998 to 2008.

Table 3.2

Change in Firm Numbers by Size band and Comparative Location

Size band 1-10 1998 2008 change

number

number

number

%cha

London 295,298

350,969

55,671

18.9

South East 275,375

342,420

67,045

24.3

SLP 55,622

68,062

12,440

22.4

OMA 218,633

264,069

45,436

20.8

Size band 11-49 1998 2008 change

number

number

number

%cha

London 35,771

37,504

1,733

4.8

South East 37,553

41,198

3,645

9.7

SLP 6,076

6,448

372

6.1

OMA 28,087

29,623

1,536

5.5

Size band 50 - 199 1998 2008 change

number

number

number

%cha

London 8,995

10,045

1,050

11.7

South East 8,767

9,826

1,059

12.1

SLP 1,477

1,540

63

4.3

OMA 6,700

7,664

964

14.4

Size band >200 1998 2008 change

number

number

number

%cha

London 2,557

2,691

134

5.2

South East 2,023

2,147

124

6.1

SLP 373

363

-9

-2.7

OMA 1,599

1,645

46

2.9

Source: ABI

However, as Table 3.2 clearly shows the general pattern of firm change within the different

areas is far more complex than the basic overview would lead us to believe. The changes in

the size bands obviously show that whilst the overall growth of firms in the SLP has been

modest in comparison to the other areas, the distribution of this growth rate across the

different firm sizes is far more radical than in the other areas.

In terms of micro firms the SLP shows a growth rate that far exceeds the OMA and London

and is only slightly behind the growth rate for the whole of the South East, at 22.4 %

between 1998 and 2008.

31

The next size band up (11-49), small to small medium firms, also displays a growth rate that

is in excess of the rate for London and the OMA, but is certainly lower than that for the whole

of the South East at 6.1% for the decade in question.

However, when we examine the growth rate of the medium and, particularly the larger sized

firm categories we find this trend is reversed, with the SLP area showing a minimal positive

growth rate for firms between 50 and 199 employees and a declining rate for firms with over

200 employees.

It is fairly apparent that whilst the SLP area has and continues to see entrepreneurial activity

within start ups and smaller firm activity, it has become less attractive towards inward invest

from larger employers. Something which London, the South East and the OMA have not

witnessed during this decade.

If we drill down into this size band information we can start to understand the specific

sectoral distribution of the growth patterns within the SLP area. Table 3.3 provides this level

of analysis which reveals not just the growth, or decline, of each broad sector by size band, it

also clearly demonstrates the magnitude of each sectors contribution to the SLP economy

by highlighting the actual number of firms within each band.

Within the micro size band there are only three sectors that both make a significant

contribution to the sub regional economy and experienced significant growth during this

decade:

Construction


Public administration, education & health

Whilst there were some expected declines in this size category (manufacturing), it is perhaps

surprising that the Distribution, Hotels and Restaurants sector also experienced a slight

decline, something which will require further investigation.

Within the small to medium size sector (11-49) there has really only been a significant

growth in the Banking, Finance and Insurance sector, however unlike the micro sector there

was a small scale increase in the Distribution, Hotels and Restaurant sector.

Within the medium to larger size categories the key growth areas were Transport and

Communications, but particularly Public Administration, Education & Health. Most of the

other sectors experienced different rates of decline apart from Other Services, which also

witnessed an increase within all size bands apart from the micro category. This is also

something that requires further detailed investigation to expose the drivers and detail of this

trend.

32

Table 3.3

Firm Change Structure by Size band in SLP Area

1998 2008 change

Size band 1-10 number number number %cha

Agriculture and fishing 65

238

173

266.2

Energy and water 34

23

-10

-32.4

Manufacturing 3,459

2,777

-681

-19.7

Construction 4,563

6,470

1,907

41.8

Distribution, hotels and restaurants 14,835

14,532

-302

-2.0

Transport and communications 1,744

1,869

125

7.2

Banking, finance and insurance 21,265

31,416

10,151

47.7


2,384

3,558

1,174

49.2

Other services 7,273 7,179 -93 -1.3

Size band 11-49 number number number %cha


13

8

160.0

Energy and water 9

6

-2

-33.3

Manufacturing 492

319

-172

-35.2

Construction 349

265

-83

-24.1

Distribution, hotels and restaurants 2,065

2,213

148

7.2

Transport and communications 228

230

2

0.9

Banking, finance and insurance 1,196

1,383

187

15.6


1,426

1,550

124

8.7

Other services 306 469 163 53.3

Size band 5--199 number number number %cha


2

-1

-50.0

Energy and water 4

0

-3

-100.0

Manufacturing 121

55

-65

-54.5

Construction 55

50

-4

-9.1

Distribution, hotels and restaurants 346

346

0

-


93

16

20.8

Banking, finance and insurance 349

335

-13

-4.0


457

572

115

25.2


Size band >200 number number number %cha


0

0

-

Energy and water 3

1

-1

-66.7

Manufacturing 34

13

-20

-61.8

Construction 13

14

1

7.7

Distribution, hotels and restaurants 76

68

-7

-10.5


34

-4

-12.8

Banking, finance and insurance 104

100

-3

-3.8


84

110

26

31.0


Source: ABI

33

3.4/ Micro Level Decline Pattern

In terms of the decline in micro firm activity within the Distribution, Hotels and Restaurants

division, a fine grained analysis of the sector using the 4 digit SIC reveals the following:

There was some growth within this sector in areas that have significant number of

units within the sub region – particularly Restaurants, Catering, Retail Sales in

Specialised Stores, Retail sale in non-specialised stores with food, beverages or

tobacco predominating, Retail Sale in Clothing, Repair of Motor Vehicles.

The main decline in this size band, which have significant numbers within the sub

region were - Bakers, Butchers, Fishmongers, Retail of household appliances,

electrical goods & hardware, Off Licences, Bars, the Sale of Motor Vehicles and

Parts, Sale of Textiles and Book shops – but also a wide spread decline in small

scale wholesale operations.

As a result of the significance of this decline within this sector at this micro level just under

2,500 business units were lost in the sub-region between 1998 and 2008. The small scale

retailer and the small scale wholesaler (the cornerstones of traditional town and district

centres) making up the greatest proportion of this decline within the sub region.

A story that is not too unusual for locations across the country that have witnessed the

decline of small scale shopping centres due to changes in work life patterns, a shift in

cultural habits and social networks, dominant large scale retail patterns and insufficient

planning capacity within the public sector.

In terms of telling the story of place this is however far more significant for South London, as

a place that up until this point has (almost) managed to hold onto its cultural heritage within

its small scale centres. Maintaining some sort of balance around this form of community

cohesion set against the pervasive forces of large scale patterns of development and labour

market commuting, which tend to erode social networks and social capital, is an essential

element of building sustainable communities,

If the pervasive forces, which dominate the development processes within the sub region (far

more than other sub regions), are allowed to continue then this inevitable decline will

continue to escalate and take with it the micro businesses at the heart of the localities that

already exhibit signs of dysfunctional tendencies. This is not a cry for the sub region to be

preserved in aspic but a realisation that managing the decline of smaller centres needs to be

considered very carefully, because the costs reach far beyond just the vacant floorspace or

immediate change of use.

3.5/ ‘Other Service’ Growth Pattern

Over the period 1998 to 2008 the figures also revealed a constant growth in the larger size

bands within the Other Service classification, drilling down into this data set reveals the

following areas where this growth took place and where there was significant impact on the

sub region in terms of units and/or employees.

Size Band 11-49

Activities of other membership organisations not elsewhere classified

Library and archive activities

34

Artistic and literary creation and interpretation

Activities of religious organisations

Operation of sports arenas and stadiums

Other sporting activities

Hairdressing and other beauty treatment

Size Band 50 -199

Motion picture projection

Artistic and literary creation and interpretation


Other sporting activities

Physical well-being activities

Size Band >200


Gambling and betting activities

Ultimately this reflects the growth in leisure and sports activities within the region (and to a

certain extent) the growth of the gambling and betting sector, that has also seen a significant

growth in many other regions.

Club memberships and private memberships have become a facet of contemporary culture

for those with sufficient disposal income, which underpins the growth in this particular sector

of the economy.

3.6/ VAT and Firm Creation

Figure 3.8 highlights the trends in net VAT registered firms within the SLP area and in

comparison to other adjoining and surrounding areas. It shows that for the decade in

question the net rate of change tended to follow these other locations and economies: if

anything in a more stable trajectory.

Figure 3.8

35

Source: VAT Registrations

In terms of how this trend applies to different sectors, Figure 3.9 shows the net change by

broad industrial classification for the same period for the SLP area. This demonstrates how

the Real Estate, Renting and Business activities have been extremely erratic in comparison

to other sectors when it comes to SME growth in the sub region. Whilst there has been a

slight increase in some of the other categories (Construction, and to a certain extent towards

the end of the period in manufacturing), the majority of the SME sector (at this level of

disaggregation) demonstrates a fairly flat net change trend.

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Net Change in VAT Registrations

London

South East

South London Partnership

OMA

36

Figure 3.9

Source: VAT Registrations

This erratic pattern, with a significant trough, in conjunction with the relatively stable trend in

other major sectors is very similar to the patterns experienced across the boroughs of

London and quite distinct from the surrounding and adjoining areas of the South East and

the OMA. Appendix 3 reveals that the fortunes of the SME sector in the SLP area are far

more allied to the intense fluctuations of the net changes within the London area than they

are to those within the wider city region. This perhaps shows its lack of independence from

the gravitational ebb and flow of economic activity within the Capital, particularly with regard

to the linkages that business activity SMEs have into the regional economy. This reflects the

transport infrastructure issues and supply chain issues with regard to the spatial markets of

SMEs, that tend to provide their businesses locally within an environment dominated by the

continual need and demand to service a highly centralised economy. Therefore, the pattern

of SME development witnessed by the OMA and the rest of the South East, which did not

experience such a severe trough as London and its sub regions, with regards to a net loss of

business service SMEs during the 2002 period, did not protect or impact upon the South

London markets to the extent one would expect considering their spatial relationship.

-500

0

500

1,000

1,500

2,000

2,500

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

VAT Registrations Net Change in SLP Area by Industry

Agriculture; Forestry and fishing

Mining and quarrying; Electricity, gas and water supply

Manufacturing

Construction

Wholesale, retail and repairs

Hotels and restaurants

Transport, storage and communication

Financial intermediation

Real Estate, renting and business activities

37

However, set against this lack of independence is the ability of the sub region to create a

better working environment for new businesses to survive in than all of the other London sub

regions. As Table 3.5 displays, the highest percentage of survival rates for the region lie

within South London (excluding the City).

Table 3.5

SME Births and Survival Rates 2008

Births

1 Year per cent

2 Year per cent

3 Year per cent

4 Year per cent

5 Year per cent

London 48,810 91.5 73.7 56.5 46.6 39.4

Inner London 26,190 91.0 72.8 55.0 45.3 38.3

Inner London Boroughs

Camden 2,670 91.4 74.2 58.6 49.1 41.9

City of London 1,110 92.3 77.9 68.5 59.9 52.7

Hackney 1,360 93.4 76.5 59.6 50.0 43.0

Hammersmith and Fulham 1,760 90.1 69.3 51.7 41.2 32.7

Haringey 1,255 91.2 70.5 54.2 44.2 35.9

Islington 1,645 91.2 74.8 59.6 48.0 41.0

Kensington and Chelsea 1,515 91.7 73.6 58.7 49.8 42.6

Lambeth 1,485 90.2 69.7 52.5 42.8 35.4

Lewisham 910 91.8 74.7 57.7 46.2 37.9

Newham 870 92.5 70.7 52.3 43.1 36.8

Southwark 1,650 90.9 74.8 58.8 47.6 40.9

Tower Hamlets 1,500 91.7 72.7 56.3 47.0 39.7

Wandsworth 2,395 88.5 68.1 49.1 38.6 32.2

Westminster 6,065 90.6 73.2 50.5 42.0 35.8

Outer London 22,620 92.2 74.8 58.2 48.1 40.7

Outer London Boroughs

Barking and Dagenham 460 90.2 73.9 55.4 44.6 39.1

Barnet 2,370 91.6 71.9 53.8 44.5 38.2

Bexley 780 92.3 76.9 59.6 50.0 43.6

Brent 1,690 91.1 68.9 52.4 42.0 34.0

Bromley 1,270 92.1 78.0 63.8 52.8 46.1

Croydon 1,405 91.8 76.2 59.1 49.1 41.3

Ealing 2,065 90.8 71.2 54.0 43.1 35.1

Enfield 1,230 93.5 76.0 60.2 50.0 41.9

Greenwich 755 93.4 75.5 57.6 47.7 39.7

Harrow 1,215 93.8 76.1 61.7 50.6 42.8

Havering 855 92.4 78.4 63.2 53.2 46.2

Hillingdon 1,145 91.7 76.4 59.8 50.2 41.9

Hounslow 1,225 91.0 75.9 60.8 49.8 40.8

Kingston upon Thames 775 95.5 80.6 65.2 56.1 48.4

Merton 1,195 90.8 70.3 54.0 44.4 37.2

Redbridge 1,115 92.4 73.1 54.3 44.4 36.3

Richmond upon Thames 1,365 93.0 79.1 63.7 54.2 47.3

Sutton 670 93.3 78.4 64.2 53.7 47.8

Waltham Forest 1,035 93.7 75.4 56.5 46.9 40.6

Source: ONS Business Demography

38

This indicates a strong level of sustainability for the SME community within the sub region

and a better long term return on investment in the area than in comparison to other locations

within the region.

Ultimately, the overall trend lines for SME development in the SLP area do not show the

dramatic changes (rates of growth or decline) as in its surrounding and adjoining areas, but

they do demonstrate the greater stability of its business environment, even though it displays

a certain lack of independence from the wider regional trends in some key sectors.

39

4/ Labour Markets, Commuting and Sustainable Spatial Geographies?

4.1/ Regional Commuting Patterns and Life Style Choices

Commuting is the one of the largest issues that links the spatial geography across London

(and to the rest of the South East) for which there is relatively reliable data (a little old in the

case of the Census) that is accurate and can be compared consistently over time.

The process of travelling to work is not just an act of travel; it is a life choice that affects our

quality of lives, our ability to be productive, causes a significant impact upon the environment

and creates a huge resource demand within the regional economy. Inevitably, for an efficient

and long term sustainable economy to work it is essential that the distance travelled by and

time taken in travelling to work is reduced to the shortest feasible, whilst still maintaining a

function of the clustered agglomeration economies that provide its competitive edge.

Therefore, the notion of how diseconomies occur is really based upon the lag in productivity

caused by the increasing volume and time taken for people to actually get to work. However,

this in itself is really only a measure of lag impact on productivity and does not take into

account many other sustainable factors that also will inevitably impact on the functioning of

the wider agglomeration.

The commuting patterns in and around London and the South East demonstrate the extent

of the interrelationship between the labour markets and the businesses within this area, but

also the life style choices (or not as the case maybe) that people have made in terms of their

environment they wish to define as home.

For example Figure 4.1 shows the mean and median house prices in Outer London in 2009.

These set against the mean prices for London (£363,043), Inner London, (£464,678), South

East (£253,905) and England (£216,493), show that for many this area (or at least parts of it)

are a very specific choice for people to live in terms of location and demand which can

command such high prices.

It is perhaps not surprising that in the top 9 outer London boroughs in terms of house price

rankings 4 are located in the South London outer area, whilst Wandsworth (as an inner area)

is also within this high end price bracket.

To live within these areas is a quality of life choice that many people make, if they can afford

it based (in many cases) upon their incomes and ability to secure high salaries, but

fundamentally based upon their commitment to commute.

This is a commitment that many people within and out side the region make, based upon a

balanced (but not necessarily rational) set of decisions that they believe offers them (and

their families in many cases) a quality of life that is sustainable whilst allowing access to the

types services, accommodation and environment they perceive they require.

Figure 4.1

40

Source: CLG Housing Live Tables

The house price figures also reveal the overall split within the sub region in terms of Croydon

and Sutton, which are not just below the average for the sub region but considerably below

the average for Outer London.

This reflects the economic geography of the sub region and localised divisions within the sub

region, not just in terms of house prices but also in terms of commuting, educational

attainment and income. But also the diversity of the economy and the nature of the

relationship of people with their local areas.

Table 4.1 offers a generalised view of the numbers of people who commute out of their area

of residence to another borough in terms of work for the whole of London.

As can be seen from this table there are many boroughs within the South London area that

exhibit a very high percentage of commuting activity (Wandsworth 66% and Merton 60% of

the workforce). And there are several (Kingston, Croydon, Sutton) that exhibit a relatively low

level of activity. This would tend to support the issue that TfL raise that 60 % of journeys

begin and end in Outer London.

House Prices 2009 Outer London + Wandsworth

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41

However, as stated above diseconomies are not just about the volume of people that move

around. For in the case of Lambeth and Wandsworth, whilst the numbers are very large the

distances and time taken are relatively small.

Table 4.1

Travel to Work Numbers for London Boroughs by Area of Residence

Area of residence

Total Commuters Workforce Percentage

Lambeth 89639 130,745 69

Wandsworth 93639 141,186 66

Haringey 63114 95,736 66

Lewisham 75147 114,583 66

Hackney 51064 79,235 64

Hammersmith and Fulham 52592 83,022 63

Islington 50367 79,855 63

Southwark 67573 107,868 63

Kensington and Chelsea 46379 75,559 61

Merton 56839 94,930 60

Newham 51666 86,433 60

Waltham Forest 57853 97,774 59

Brent 69,273 118,704 58

Redbridge 61014 106,109 58

Greenwich 52028 91,588 57

Tower Hamlets 41970 73,953 57

Barking and Dagenham 37,192 65,869 56

Camden 51652 91,872 56

Ealing 78821 143,764 55

Harrow 49941 97,759 51

Barnet 74,387 145,912 51

Richmond upon Thames 45341 89,420 51

Bexley 51,202 103,635 49

City of London 2068 4,299 48

Bromley 67406 141,500 48

Enfield 57006 121,263 47

Hounslow 48429 103,616 47

Westminster 39265 89,471 44

Sutton 39612 90,293 44

Havering 45641 104,538 44

Croydon 64555 156,734 41

Kingston upon Thames 30704 74,877 41

Hillingdon 37051 117,035 32

Source: Census 2001

42

Hence it is important not just to look at the numbers involved or the just the percentages, but

also the distance travelled: which in the case of London can equate to considerable

timescales.

Table 4.2 shows the percentage of the workforce within each borough that travel on average

the furthest distance within London to get to work: this is between 10km and 20km.

Table 4.2

Travel to Work Numbers by Furthest Distance Travelled in London

Area of Residence Number of People who travel 10km to less than 20km

Workforce Percentage

Redbridge 36,743 106,109 34.6

Merton 30,858 94,930 32.5

Bromley 45,145 141,500 31.9

Enfield 36,961 121,263 30.5

Greenwich 27,778 91,588 30.3

Bexley 31,373 103,635 30.3

Barnet 42,231 145,912 28.9

Richmond upon Thames 25,602 89,420 28.6

Waltham Forest 27,183 97,774 27.8

Barking and Dagenham 18,093 65,869 27.5

Harrow 26,468 97,759 27.1

Kingston upon Thames 20,057 74,877 26.8

Newham 22,136 86,433 25.6

Ealing 36,330 143,764 25.3

Croydon 38,901 156,734 24.8

Sutton 20,963 90,293 23.2

Lewisham 25,695 114,583 22.4

Brent 22,725 118,704 19.1

Hounslow 18,160 103,616 17.5

Havering 18,092 104,538 17.3

Wandsworth 22,698 141,186 16.1

Hillingdon 18,487 117,035 15.8

Haringey 14,830 95,736 15.5

Lambeth 14,433 130,745 11.0

Hammersmith and Fulham 7,677 83,022 9.2

Hackney 6,288 79,235 7.9

Southwark 8,163 107,868 7.6

Tower Hamlets 5,326 73,953 7.2

Kensington and Chelsea 4,307 75,559 5.7

Islington 4,432 79,855 5.6

Camden 4,832 91,872 5.3

Westminster 3,900 89,471 4.4

City of London 98 4,299 2.3

43

Source: Census 2001

As can be seen from this table, and as might be expected, it is mostly the Outer London

borough residents that travel the furthest distance. But just in terms of percentages, the

South London boroughs are some of the highest exporters of labour over this distance

(Bromley, Merton, Richmond and Kingston between a quarter and a third of the labour

force).

The key questions therefore based on this type of information are where do these people

travel to and what type of work are they engaged in. This is very important because it will

provide an insight into the type of regional economy they are supporting, their life style

choices, the costs to the regional economy and the environmental impact that these

commuters are having and, when considered in relation to the house price data, the types of

disparities that are being created inter and intra sub regionally.

4.2/ Commuting Patterns in and across South London

To fully understand the geographical extent of the commuting pattern into South London and

its linkages with the wider South East it was possible to map out the total commuting

patterns into the sub region. This is shown in Figure 4.2 and clearly shows the vast extent

and range of areas that people travel from to actually work within the sub region.

Figure 4.2

Source: Census 2001

44

Once the transport network is taken into account it is fairly obvious why these commuting

patterns exist across the South East.

Figure 4.3

Source: Census 2001

The commuting patterns which have developed over many decades reflect the major

transport networks across the South East and particularly the major corridors to the SW (A3)

the South (M23) and the SE (M20). These corridors are also supported by the rail networks,

particularly down to the south coast in area around Brighton.

Whilst this SE network is very extensive, the linkages into these counties and areas beyond

the Surrey and Kent borders are relatively small in comparison to the workers that travel into

the sub region from adjacent areas or indeed move around within the sub region for work

purposes.

If we take a closer look at the more significant local geography of the area, by focusing in on

the adjacent local authorities to the sub region (something we could call the buffer zone) it is

far more apparent where the significant functional geographies lie in terms of the sub region

acting as a place of employment and drawing labour from outside of the area.

Figure 4.4

45

Source: Census 2001

Figure 4.4 clearly shows where the strongest linkages are with regards to the SE and other

London local authority districts.

The strongest links in terms of bringing people into the area are to the west where Richmond

and Kingston have a very close affinity with the labour force in Hounslow and to the north

where several boroughs have very close ties with the labour markets in Lambeth and

Lewisham.

Outside of the sub region the strongest connections, in terms of labour market attraction, are

with Elmbridge, Epson and Ewell and Reigate and Banstead (and to a lesser extent Mole

Valley).

All of these external connections represent both the need in the sub region for importing

labour, particularly in terms of middle to low wage earners, to service the public sector, retail

and leisure industries, and the radial linkages that that allow relatively convenient access

along the arterial routes.

Whilst these connections are relatively strong it must be recognised that the number

travelling in from these areas on a daily basis is quite small in comparison to the numbers

travelling internally within the sub region or even travelling from the sub region elsewhere or

across the sub region to other locations, to which we will return.

46

Therefore it must be recognised that, apart from certain locations, the labour markets

surrounding the sub region, especially to the south east, are fairly isolated, both a reflection

of the demand and the access issues for cross border travel.

This is also relatively true of the cross border links in terms of exporting labour from the sub

region to other parts of the South East outside of London.

Table 4.3

Export of Labour from the SLP sub region to the South East

area of residence

Type of Employment Bromley Croydon Kingston upon Thames

Merton Richmond upon Thames

Sutton Wandsworth

Total 8,164 11,816 9,642 5,620 8,612 11,435

5,014

Higher managerial occupations 769 858 1,045 673 1,894 739 885

Higher professional occupations 1,129 1,511 1,722 1,267 1,857 1,325 1,428

Lower managerial and professional occupations

2,802 4,060 3,302 1,861 2,940 3,995 1,708

Intermediate occupations 880 1,781 1,061 605 670 1,994 321

Small employers and own account workers

442 467 316 165 268 425 121

Lower supervisory and technical occupations

741 1,020 636 412 354 1,013 187

Semi-routine occupations 650 1,136 724 291 280 985 144

Routine occupations 560 642 502 261 203 713 78

Never worked and long-term unemployed

0 0 0 0 0 0 0

Full-time student 191 341 334 85 146 246 142

Source: Census 2001

Table 4.3 shows, as might be expected, due to proximity, size and labour markets, Croydon

exports the highest number of workers into the South East and this tends to be towards the

Gatwick/Crawley area as does Sutton. Richmond and Kingston also export a reasonable

amount of people on a daily basis, particularly towards the Heathrow area.

Overall the main category of export tends to be in the lower managerial and professional

occupations, and to a certain extent the higher professional occupations. This tends to be

due to the greater spatial mobility of these employees, who are more inclined to travel further

distances and are more flexible in terms of their job search options.

But, as with the employees moving into the area on a daily basis from the South East, the

numbers being exported are relatively small in comparison to the numbers moving around

the area, through the area or from the area into Central London.

In terms of the impact on the transport system, the through journeys are extremely

significant to the sub region.

Table 4.4

47

Through Journeys in the South London Sub Region from the South East

Area of residence Central London City of London Westminster

Crawley 2161 490 586

Elmbridge 10772 2,420 3,366

Epsom and Ewell 5988 953 1,766

Guildford 5059 1,168 1,642

Hart 2055 501 618

Horsham 2727 658 840

Maidstone 5086 1,161 1,243

Mid Sussex 5054 1,461 1,388

Mole Valley 4059 811 1,313

Reigate and Banstead 7144 1,470 1,899

Runnymede 2542 444 809

Rushmoor 1505 312 489

Sevenoaks 10594 2,655 2,478

Spelthorne 3176 414 994

Surrey Heath 2144 434 713

Tandridge 5294 1,204 1,469

Tonbridge and Malling 6152 1,584 1,458

Tunbridge Wells 5881 1,809 1,503

Waverley 4215 1,065 1,348

Woking 4849 1,157 1,484

Totals 96457 22,171 27,406

Source: census 2001

As Table 4.4 shows the total through journeys from districts within the South East, that have

to cross the sub region, to get into Central London is very close to 100k per day and 50% of

this traffic is travelling directly to just two areas: Westminster and The City of London.

Essentially this reflects the centralised geography of the labour markets within this part of the

South East, which tends to rely upon localised district centres for employment or a long

distance commute into Central London.

This however is just part of the strain on the infrastructure of the sub region and as Figure

4.5 shows it is the most congested sub region outside of the centre. This is therefore a

problem for the sub region not just in terms of the notoriously bad orbital connections, but

also for the arterial radial connections that support not just the area but also the central

economy.

To highlight the notoriously poor orbital connections and the extent of the journeys with the

sub region (particularly within individual boroughs), Table 4.5 details the number of commute

journeys within the area between partner boroughs.

48

Figure 1.5

Highway Congestion in London

Source: GLA Econimic Evidence Base 2009

Table 4.5

Internal Commute Patterns within the SLP Sub Region

area of workplace

Area of residence

Total Outside Own Area within SLP

Bromley Croydon Kingston upon Thames


Sutton Wandsworth

Bromley 9505 63,942 6,269 233 648 191 795 1,369

Croydon 20988 5,147 78,408 826 3,517 484 6,742 4,272

Kingston upon Thames

11138 74 635 33,434 3,042 3,791 1,191 2,405

Merton 20521 315 3,191 3,515 31,262 1,348 3,739 8,413

Richmond upon Thames

7005 64 315 3,547 842 33,928 250 1,987

Sutton 21933 516 7,605 3,119 6,723 754 38,224 3,216

Wandsworth 11281 328 1,499 1,809 4,333 2,329 983 40,580

Total 102371 70386 97922 46483 50367 42825 51924 62242

Source: Census 2001

49

As Table 4.5 demonstrates by far the greatest proportion of travel within the sub region

occurs within individual boroughs, which would equate to distances of between 2km and 10

km, depending on the borough in question.

However, one of the most striking issues within this table is the relatively limited cross border

travel from some authorities into the rest of the sub region. Richmond especially only exports

just over 7000 people into jobs within the rest of the sub region which is far less than many

local authority areas outside sub region.

Bromley, Kingston and Wandsworth are the middle exporters of people into employment

within the sub region outside of their areas, but these are only similar to the number coming

in from some adjoining SE districts and significantly less than the numbers coming into the

area from Lambeth and Lewisham.

Only Merton, Sutton and Croydon are the significant contributors of labour into the sub

region outside of their area and show clear signs of a combined labour market (Croydon and

Bromley to a less extent).

This is a product of the size of these labour markets, the density of employment, transport

access and diversity of jobs within this pooled area. However, it is still significant, that

irrespective of this type of linkage, the main connections within the sub region are mostly

with adjoining boroughs. The barriers to travel within the sub region are very evident within

these patterns and for some boroughs there is virtually no connection whatsoever,

particularly at the extremes of the sub region.

These travel patterns and labour market economies are the product of many decades of

development, defining the geography of the area, based upon localised economic centres

and the general centrality of development around an urban core, which in many ways does

not fit with the administrative boundary of the sub region.

To highlight this case even further and to start to question to logic of maintaining centralised

forms of development at such a high level of urban agglomeration, travel from the sub region

to the rest of London needs to be assessed.

4.3/ Commuting Patterns from South London

The total number of people travelling from the sub region to the rest of London is 295, 725

and Table 4.6 shows where these people are exported to on a daily basis.

This means that, with the through journeys, around 400k people a day are travelling across

the sub region (with journeys in excess of 10km), over 100k are travelling within the sub

region from one SLP borough to another, and 320k are travelling within their own borough.

In total this means that on average 820k people a day are using the sub regional

infrastructure, which does not take into account casual, school runs, shopping and leisure

trips of any kind.

50

Table 4.6

Commute Numbers from SLP Sub Region to the rest of London

area of residence

Area of workplace Bromley Croydon Kingston upon Thames


Sutton Wandsworth

Barking and Dagenham

131 82 3 33 16 29 34

Barnet 161 220 119 189 180 78 300

Bexley 3,197 304 30 49 12 61 70

Brent 197 319 187 248 340 133 407

Camden 3,774 3,257 1,536 2,937 2,504 1,442 7,142

City of London 9,853 5,918 2,873 6,044 4,835 2,558 13,943

Ealing 285 409 473 549 1,462 302 973

Enfield 82 122 38 51 45 33 117

Greenwich 2,590 539 59 180 65 102 261

Hackney 722 594 186 445 289 229 1,048

Hammersmith and Ful

852 1,293 1,328 2,305 3,183 853 6,228

Haringey 132 184 37 133 55 51 225

Harrow 60 94 66 75 160 45 134

Havering 118 84 16 19 16 27 32

Hillingdon 241 453 1,060 531 3,380 388 844

Hounslow 279 569 1,481 835 6,870 551 1,697

Islington 2,094 1,753 712 1,418 1,019 677 3,391

Kensington and Chel

1,249 1,476 843 2,215 1,740 884 6,211

Lambeth 3,563 6,836 1,025 3,391 1,214 1,831 5,952

Lewisham 5,367 1,560 73 255 82 269 412

Newham 426 202 79 145 58 94 211

Redbridge 101 58 34 42 6 26 58

Southwark 6,057 4,517 1,034 2,292 1,213 1,409 4,089

Tower Hamlets 3,377 2,006 829 1,710 1,208 869 4,031

Waltham Forest 201 138 28 75 50 41 138

Westminster 12,792 10,580 5,417 10,152 8,334 4,697 24,410

Column Total 57,901 43,567 19,566 36,318 38,336 17,679 82,358

Source: Census 2001

Within the above table the top three destinations for each of the SLP boroughs have been

highlighted to reveal their closest partners in terms of labour market connections. From this it

is obvious that most boroughs have a fairly strong relationship with Central London, some

more than others, but also that some boroughs have a special relationship with one or two

labour markets that are not part of the usual flow of people. Richmond and

Hillingdon/Houslow is a fairly obvious one, determined by the Heathrow labour market area

and associated industries.

51

Of all the boroughs, Kingston perhaps has the most evenly distributed connection with the

rest of the London boroughs outside the sub region, and less of a focus on central

employment. This would critically be a factor of its poor transport infrastructure into the

centre (in comparison to the other boroughs), its diverse and highly educated labour force.

4.4/ A Sustainable Future?

Overall the SLP sub region exports approximately 250k people per day into 9 Central

London boroughs and over 120k per day into just 2: Westminster and the City of London.

If we were to calculate the cost of this average journey (average journey time 1hr each way)

and what it means simply in terms of person days, it would equate to just over 60,000 person

days a day taken up by travel. Based on the types of salaries earned within the sectors that

these commuters are involved in, this would equate to a huge daily cost in terms of personal

GDP.

However, apart from this huge labour cost (and drag on productivity) it is also clear that there

are many other issues at stake, some of which, such as the quality life for the individuals and

communities, it is not possible to quantify here and some of which, such as the

environmental impact, it is possible to allude to.

Table 4.7

Lowest 12 Boroughs for Carbon Emissions 2007

Area Ind and Comm Domestic

Road Transport Total Population

Per Capita Emissions (t)

Bromley 378 766 343 1493 300.7 5

Richmond upon Thames 320 450 224 995 180 5.5

Lewisham 298 536 269 1104 258.5 4.3

Hackney 295 406 175 877 209.7 4.2

Havering 290 545 444 1280 228.4 5.6

Harrow 282 509 165 957 214.6 4.5

Waltham Forest 275 468 193 937 222.3 4.2

Haringey 270 507 195 973 224.7 4.3

Merton 265 409 173 850 199.3 4.3

Kingston upon Thames 247 350 241 840 157.9 5.3

Sutton 239 418 185 845 185.9 4.5

Redbridge 231 539 289 1060 254.4 4.2

Source: DECC – Measure Kilotonnes of Carbon

52

At present of the lowest 12 boroughs measured by carbon emissions for Industry and

Commerce, 5 of them are within the sub region.

This is a clear indication that within these locations at present they have the capacity to be

able to increase their business contribution to the London economy without causing an

excessive increase in emissions to dangerous levels. This is both on a local, regional and

international basis.

Table 4.8

Highest 8 Boroughs for Carbon Emissions 2007

Area Ind and Comm Domestic

Road Transport Total Population

Per Capita Emissions (t)

Westminster 2466 483 336 3285 234.1 14

Tower Hamlets 1596 364 306 2266 215.3 10.5

City of London 1523 20 66 1609 8 201.1

Camden 1118 406 170 1695 231.9 7.3

Hillingdon 1032 560 570 2164 250.7 8.6

Southwark 899 486 270 1657 274.4 6

Kensington and Chelsea 768 394 174 1336 178.6 7.5

Newham 727 451 298 1477 249.6 5.9

Source: DECC – Measure Kilotonnes of Carbon

Whereas the top that have the highest emissions account for where 242k people per day

travel to in Central London from the sub region to work.

At the moment the cost in terms of health alone are significant issues as to why this type of

centralist policy cannot be allowed to continue, but the long term implications are even more

serious on the local environment and the global climate.

All of this clearly indicates the huge problems associated with the labour markets

connections in and around South London and the essential need to critically evaluate the

centralist policies that exacerbate this type of development.

Ultimately it is not a sustainable agenda, which impacts on the communities where people

travel from (dormitory societies deprived of social capital with polarised inefficient local

economies) and the communities where they travel to (congested environmentally

dangerous space). Not including the impact on the individuals, the huge cost of moving

them, the drag on productivity and the negative impacts on the wider environment.

53

5/ Workforce and Worklessness

5.1/ Key Workforce Statistics

The below series of figures represent the key workforce indicators for the SLP area set

against its surrounding and adjoining areas. However, before these are discussed Table 5.1

reveals the latest numbers that are involved within the SLP workforce area to give an

indication of the actual size and percentage of the workforce issues.

Table 5.1

Key Workforce Statistics for SLP Area 2008/09

number denominator percent

Economic activity rate - working age 894,500 1,098,200 81.4

Employment rate - working age 835,200 1,098,200 76.0

% of working age who are employees 708,000 1,098,200 64.5

% of working age who are self employed 125,200 1,098,200 11.4

Unemployment rate - working age 59,300 894,500 6.6

Unemployment rate - 16+ 60,500 932,200 6.5

% who are economically inactive - working age 203,800 1,098,200 18.6

% of working age who are economically inactive - want a job 59,300 1,098,200 5.4

% of working age who are economically inactive - do not want a job

144,500 1,098,200 13.2

Source: Annual Population Survey

As can been seen the economic activity rate is relatively high and the unemployment rate

relatively low for figures representing an economic downturn. However, the key impacts of

public sector decline have not been fully recorded within this context.

5.2/ Economic Activity Rate

Figure 5.1

54


As Figure 5.1 demonstrates the economic activity rate was still growing in the SLP area up

until the end of 2009, unlike in the surrounding areas of the South East and the OMA. And

whilst the economic activity rate was growing within London during this time, the rate in the

SLP area was far in excess of the regional average.

Therefore in terms of activity rate the SLP area shows clear signs of catching up with its

surrounding areas, with the continued potential for high levels of participation from its

workforce. However, this should not be confused in terms of a highly productive sub regional

economy as the GVA figures demonstrate that, whilst activity is high and growing, the area

itself is constrained by low productivity sectors and a vast amount of outward commuting to

high productivity sectors in other central locations.

In terms of activity, this clearly reflects the fact that the potential exists if the opportunities

could be provided in a more localised setting.

5.3/ Unemployment and Economically Inactive

Figure 5.2

70.0

72.0

74.0

76.0

78.0

80.0

82.0

84.0

2004/5 2005/6 2006/7 2007/8 2008/9

Economic activity rate - working age

London

South East

SLP

OMA

55


Figure 5.2 indicates that whilst the unemployment rate in the SLP area has been consistently

higher than that in the South East and OMA, it has tended to lag behind and follow the

general London trend.

However the recent recession that has hit all areas, as indicated by the 2008/9 statistics,

appears to have disproportionally hit the SLP area, widening the gap between the sub region

and the South East and OMA (which for the previous three years had been closing) and

bringing the rate for the area closer to that for the London average.

This certainly ties in with the narratives from the sub regional workforce support networks

and the Sub Regional Interim Work and Skills Plan, which clearly indicate that, due to the

structural dependence of SLP residents for employment within financial and business

services, the sub region is at an inherent disadvantage due to the nature of the current

economic downturn.

This characteristic is also displayed in Figure 5.3 which shows the number of economically

inactive who want a job. The numbers in this category relative to surrounding areas has

grown in the sub region in the run up to the downturn and during the peak impact of the

crunch on the financial services sector during 2009.

Figure 5.3

0

1

2

3

4

5

6

7

8

9

2004/5 2005/6 2006/7 2007/8 2008/9

Unemployment rate - 16+

London

South East

SLP

OMA

56


As the sub region has very high economic activity rates and, in the main, a very high cost of

living there is little opportunity for long term unemployment and inactivity. The result, as

shown in Figure 5.4, is that inactivity rates are relatively low in comparison to the London

average, but do tend to follow the trends within surrounding areas.

Figure 5.4


This does not mean that relative/absolute deprivation and low income groups do not exist

within the sub region; it means the relative exclusion of these groups is even greater than

would be experienced by groups in other sub regions. This results from a greater

0

1

2

3

4

5

6

7

8

2004/5 2005/6 2006/7 2007/8 2008/9

% of working age who are economically inactive - want a job

London

South East

SLP

OMA

0.0

5.0

10.0

15.0

20.0

25.0

2004/5 2005/6 2006/7 2007/8 2008/9

% of working age who are economically inactive - do not want a job

London

South East

SLP

OMA

57

polarisation of the social dynamic within the south sub region and a less effective framework

of support/investment triggered by the isolated and sparse spatial patterns of these groups.

5.4/ Self Employment

Figure 5.5 presents one of the key statistics that differentiates the sub region from its

surrounding areas: the percentage of people who are self employed.

Figure 5.5


The sub region displays very high percentages of people who are self employed in

comparison the rest of the South East and London. For this section of the economy it is

much closer in its structural make up to the OMA, which during the same period has

displayed (at times) equal and greater to percentages of self employed.

It has been recognised for a long time through all the boroughs in South London that this

section of the workforce is a critical part of the sub regional economy, and these figures

show that this is going to be an increasing issue. This has implications for business support

mechanisms, premises, home working/technology requirements, transport and procurement

procedures which will require further investigation.

5.5/ Structure of the Residential Workforce

Figure 5.6 presents the comparative picture of which industries the residents from the SLP

area work in (not as in the case of the ABI which shows the jobs within the area). This is

significant because it clearly shows, more so than surrounding and adjoining areas, the

structural dependence of the labour force within the area upon two key employment sectors:

Banking, Finance and Insurance

Public Administration, Education and Health

9.6

9.8

10.0

10.2

10.4

10.6

10.8

11.0

11.2

11.4

11.6

2004/5 2005/6 2006/7 2007/8 2008/9

% of working age who are self employed

London

South East

SLP

OMA

58

This is of no surprise, but it does serve to demonstrate the vulnerability of the area to the

current downturn and future spending reviews.

Figure 5.6


Figure 5.7

0

5

10

15

20

25

30

35

London South East SLP OMA

% of Residents Working by Industry:SLP and Surrounding Area, 2009 agriculture and fishing

energy and water

manufacturing

construction

distribution, hotels and restaurantstransport and communicationsbanking, finance and insurancepublic admin. education and healthother services

0

5

10

15

20

25

30

35

40

SLP Central London East London North London West London

% of Residents Working by Industry:London Sub Regions 2009 agriculture and fishing

energy and water

manufacturing

construction

distribution, hotels and restaurantstransport and communicationsbanking, finance and insurancepublic admin. education and healthother services

59


Figure 5.7 reinforces the level of this structural dependency within the SLP sub region, as it

compares its workforce composition with other London sub regions. Whilst other sub regions

display a slightly more dispersed level of activity across the main industrial sectors, the

numbers once again confirm the dominance of just two industrial sectors within the SLP

area.

Figure 5.8 gives a clear indication of the occupational structure of the SLP area in

comparison to its surrounding and adjoining areas.

Figure 5.8


This demonstrates that not only is the SLP workforce dominated by two particular sectors,

but that the area has a preponderance of residents that are employed within the three most

senior occupational levels. Only within the OMA is the percentage employed within one of

the most senior occupations (managers and senior officials) higher than in the SLP area. Not

surprising given the commuting patterns from this area into London and into the county

towns from within their own regions.

0

5

10

15

20

25

London South East SLP OMA

% of Working Residents by Occupation in SLP and Surrounding Areas 2009 % all in employment who are - 1:

managers and senior officials

% all in employment who are - 2: professional occupations

% all in employment who are - 3: associate prof & tech occupations

% all in employment who are - 4: administrative and secretarial occupations% all in employment who are - 5: skilled trades occupations

% all in employment who are - 6: personal service occupations

% all in employment who are - 7: sales and customer service occupations% all in employment who are - 8: process, plant and machine operatives% all in employment who are - 9: elementary occupations

60

But it is also clear from Figure 5.8 that in comparison to the outer lying areas the SLP area

has less of its workforce within the skilled trades and elementary occupations. This is also

reinforced by the commuting patterns into the sub region to fulfil these occupations.

This pattern is also highlighted by the occupational structure of the SLP area compared to

the other London sub regions. As shown in Figure 5.9.

Figure 5.9


It is apparent from this distribution of occupational types across London that the Centre and

the SLP area service not just the financial and business sectors, but also the senior positions

within these sectors. Whilst the occupational structures of the other sub regions are far more

evenly dispersed across the various categories.

This is potentially another vulnerable aspect for the sub region, not just due to the life style

implications of these occupations but, because of the actual imbalance in the occupational

structure of the area, causing a polarisation of the occupations and associated residential

patterns. This has further implications for the need of these senior positions to constantly

maintain a certain income, which can only be achieved (at present) through travel and a

need to draw into the area other occupations to service the lower income sectors within its

economy.

Ultimately, this pattern of development, which as Figure 5.10 explores for the sub region

over the last five years, demonstrates an ongoing polarisation of the residential workforce

0

5

10

15

20

25

30

SLP Central London

East London North London

West London

% of Working Residents by Occupation London Sub Regions 2009

% all in employment who are - 1: managers and senior officials

% all in employment who are - 2: professional occupations

% all in employment who are - 3: associate prof & tech occupations

% all in employment who are - 4: administrative and secretarial occupations% all in employment who are - 5: skilled trades occupations

% all in employment who are - 6: personal service occupations

% all in employment who are - 7: sales and customer service occupations% all in employment who are - 8: process, plant and machine operatives% all in employment who are - 9: elementary occupations

61

within the area, which if left unchecked will continue to destabilise not just its functioning

economy but also its social capital. The basic fundamentals of a sustainable community,

including the social relations that support and deliver economic activity, require a mixed and

diverse set of people and activities. This is something that is essentially being eroded within

the sub region, as the unsustainable short term requirements of the existing patterns of

development are being given priority.

Figure 5.10


This polarisation of the workforce is not only reflected in terms of the position people occupy

but also by the level of education attained. Figure 5.11 shows the manner in which this is

represented in the SLP area set against surrounding and adjoining areas, including the other

London sub regions.

5.6/ Qualifications and Pay

Set within this context and considering the size of the sub region in terms of the workforce, it

is obvious that, in relative terms, the area exhibits quite a dramatic polarisation of working

age people based on their qualifications. Only central London displays a more skewed

percentage of its workforce within the higher qualification category.

0.0

5.0

10.0

15.0

20.0

25.0

2005 2006 2007 2008 2009

% Residents in SLP area by Occupation 2005 to 2009 % all in employment who are -

1: managers and senior officials

% all in employment who are -2: professional occupations

% all in employment who are -3: associate prof & tech occupations% all in employment who are -4: administrative and secretarial occupations% all in employment who are -5: skilled trades occupations

% all in employment who are -6: personal service occupations

% all in employment who are -7: sales and customer service occupations% all in employment who are -8: process, plant and machine operatives% all in employment who are -9: elementary occupations

62

This further confirms the distinct nature of the sub region with regards its residential

workforce set against its surrounding sub regions and regions. It emphasises the particularly

highly skilled/qualified nature of these communities and the potential they offer for

developing local economies and businesses within the sub region, rather than servicing

development elsewhere within the Capital or even within the rest of the South East region.

Figure 5.11


The level of qualifications and senior positions found within the SLP area are also reflected

in the gross pay scales.

Figure 5.12

0

5

10

15

20

25

30

35

40

45

London South East

SLP Central London

:East London

North London

OMA West London

% of Residents by Qualification Categories 2006

% with degree or equivalent and above

% with higher education below degree level

% with GCE A level or equivalent

% with GCSE grades A-C or equivalent

% with other qualifications

% with no qualifications

63

Source: Annual Survey of Hours and Earnings

Figure 5.12 compares the median gross weekly pay within the SLP area to its surrounding

areas and shows that on average the workers within the south London sub region command

a higher wage than those of their neighbours. Surrey is the closest area comparator, where

significant median wages are also recorded.

This is to be expected as the social environment and quality of life within the two areas is

comparable for a range of communities, but at the same time it obviously masks the wide

variations at the local level and the inherent polarisation brought about by this high level of

income.

5.7/ Benefit Claims

Figure 5.13

633.6

520.0

623.4598.6

536.6

0.0

100.0

200.0

300.0

400.0

500.0

600.0

700.0

SLP Kent Surrey London South East

Median Gross Weekly Pay 2009

64

Source: Claimant Count DWP/ONS

The JSA Claimant rate reveals the rate of change within the SLP area has followed a similar

pattern to that of its surrounding areas and in terms of direct comparison it has almost been

identical to that for West London over the last 10 years. However, it is also worth noting that

under the current down turn the rates within the OMA and South East have almost become

the same.

Figure 5.14

0.0

1.0

2.0

3.0

4.0

5.0

6.0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

JSA Claimant Count Rate

London

South East

SLP

Central London

East London

North London

OMA

West London

65


For the long term claimants (those over 12 months – Figure 5.14) there was not such a

dramatic fall in the SLP area as there was in other locations during the boom period leading

up to the economic downturn, which means that the upturn in the rate (which has occurred in

the SLP area equal to other locations) has brought the SLP long term claimant profile closer

to those of other areas. In fact the overall trend for the decade for long term unemployment

has resulted in a significant drop for most areas apart from West London, SLP, OMA and the

South East.

Table 5.2

% Change in Claimant Count by Occupation 2005-2010

Sought Occupation 2005 2010 change %cha

0 : Occupation unknown 45 330 280 613.0

1 : Managers and Senior Officials 1,925 2,350 425 22.0

2 : Professional Occupations 1,305 1,560 255 19.6

3 : Associate Professional and Technical Occupations

2,555 3,395 835 32.7

4 : Administrative and Secretarial Occupations 3,265 4,780 1,510 46.3

5 : Skilled Trades Occupations 2,890 3,400 510 17.6

6 : Personal Service Occupations 1,105 1,790 685 62.1

7 : Sales and Customer Service occupations 3,410 6,930 3,520 103.1

8 : Process, Plant and Machine Operatives 1,375 2,070 695 50.8

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

JSA Claimant Rates for those Claiming Over 12 Months

London

South East

SLP

Central London

East London

North London

OMA

West London

66

9 : Elementary Occupations 4,865 6,095 1,230 25.3

Column Total 22,745 32,695 9,950 43.7

Usual Occupation 2005 2010 change %cha

0 : Occupation unknown 45 330 285 617.4

1 : Managers and Senior Officials 1,930 2,350 420 21.6

2 : Professional Occupations 1,215 1,575 360 29.4

3 : Associate Professional and Technical Occupations

2,445 3,405 955 39.1

4 : Administrative and Secretarial Occupations 3,240 4,610 1,370 42.3

5 : Skilled Trades Occupations 2,725 3,445 720 26.4

6 : Personal Service Occupations 1,030 1,770 740 71.6

7 : Sales and Customer Service occupations 3,605 7,080 3,475 96.4

8 : Process, Plant and Machine Operatives 1,315 2,080 765 58.1

9 : Elementary Occupations 5,185 6,050 865 16.6

Column Total 22,745 32,695 9,950 43.7


Table 5.2 indicates the types of occupations most affected by unemployment (JSA

Claimants) during the economic downturn. This is split into the types of occupation sought

and the usual occupation of the claimant. Although it must be noted that this is not a direct

measure of unemployment and for many in the professional and senior managerial positions,

because they choose not to (or can not) claim JSA, it does not present an accurate picture of

their position.

The statistics reveal that the immediate impact of the down turn has had a significant impact

across all areas, with a minimum of a 20% rise in all claimants irrespective of occupation. As

expected, due to the caveats of the information the professional and senior managerial

occupations saw the least rise (although this was 20-30%) where as the greatest increase

(where the data is likely to be more accurate) was within the main residential employment

sectors for the SLP area: personal service, and sales and customer service occupations.

Once again, this is the type of impact within the area which will serve to increase the

polarisation of those in work or seeking work, who are professionally and spatially more

mobile and those who are not.

In terms of the different types of benefits claimed within the area in comparison to other

locations (Figure 5.15), the SLP area tends to reflect the trend within the South East and the

OMA far more than London and its sub regions. However, in comparison to these areas

within the wider region, the SLP area does exhibit an obviously higher rate of income

support/pension credit, which distinguishes it from these areas and bring it more into line

with West London.

Figure 5.15

67

Source: DWP Work and Pensions Longitudinal Study

In terms of the trends for specific benefits within the SLP area over the past 10 years (Figure

5.16), it is interesting to note that the claimant rate for the main benefits (income

support/pension credit/incapacity benefit) have all declined during this period (even taking

2002 as a start point when benefits were reassessed), whereas careers allowance and

disability living allowance have increased. It is anticipated that due to the demographic

nature of the SLP area and structural ageing within the population, that this will continue to

increase.

It is also very apparent the impact the recent down turn has had on JSA claimants within the

SLP area since 2007, which has seen a dramatic increase after only a marginal fall during

the preceding boom period. This is a reflection of the area operating at its full potential with

regard to economic activity and the hard to reach groups being entrenched within the

worklessness profile.

Figure 5.16

0.0

1.0

2.0

3.0

4.0

5.0

6.0

London South East

SLP Central London

East London

North London

OMA West London

Rate of and Type of Benefit Claimants 2009 SLP and Surrounding Areas

carers allowance (CA) only

disability living allowance (DLA) only

incapacity benefit (IB) or ESA only

income support (IS)/pension credit (PC) only

job seekers allowance (JSA) only

severe disablemanet allowance (SDA) only

DLA and SDA

IB/ESA and DLA

IS/PC and CA

IS/PC and IB/SDA

IS/PC, DLA and SDA

IS/PC, IB and DLA

other combinations

68

Source: DWP Work and Pensions Longitudinal Study

5.8/ Job Density and Vacancies

Figure 5.17 shows the density of jobs within the SLP area and its surrounding areas, that is

the number of jobs per resident of working age, and as can be seen the SLP density is

relatively low compared to most of the other locations, apart from East and North London.

Considering the high economic activity rate in the area, this low figure is a factor of the

broader demographic within the SLP area, with a higher representation from those not of

working age. The number of young, due to a significant family composition and the number

over the working age, as the area also has a relatively high percentage of people over 65.

Figure 5.17

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Benefit Claimants by Type SLP 1999- 2009

carers allowance (CA) only

disability living allowance (DLA) onlyincapacity benefit (IB) or ESA onlyincome support (IS)/pension credit (PC) onlyjob seekers allowance (JSA) onlysevere disablemanet allowance (SDA) onlyDLA and SDA

IB/ESA and DLA

IS/PC and CA

IS/PC and IB/SDA

IS/PC, DLA and SDA

IS/PC, IB and DLA

other combinations

69

Source: ONS Employee Jobs Estimates

In terms of the excess demand within the economy for certain occupations, Figure 5.18

shows that the SLP area does differ from its surrounding and adjoining areas, particularly in

terms of the relatively low need for associate professional and technical operations, which is

a significant demand in other sub regions and areas.

In addition, there is also a high demand for personal service occupations within the area in

comparison to other occupations, these cover Healthcare And Related Personal Services,

Childcare And Related Personal Services, Animal Care Services, Leisure And Travel

Service Occupations, Hairdressers And Related Occupations, Housekeeping Occupations,

Personal Services Occupations.

And within the area there also appears to be less of a need for elementary occupations, in

comparison to other locations: Elementary Agricultural Occupations, Elementary

Construction Occupations, Elementary Process Plant Occupations, Elementary Goods

Storage Occupations, Elementary Administration Occupations, Elementary Personal

Services Occupations, Elementary Cleaning Occupations, Elementary Security Occupations,

Elementary Sales Occupations.

Figure 5.18

0.00

0.50

1.00

1.50

2.00

2.50

London South East SLP Central London

East London North London

OMA West London

Jobs density 2009

70

Source: DWP

0.0

5.0

10.0

15.0

20.0

25.0

30.0

London South East

SLP Central London

East London

North London

OMA West London

Vacancies Notified by Occupation May 20101 : Managers and Senior Officials

2 : Professional Occupations

3 : Associate Professional and Technical Occupations4 : Administrative and Secretarial Occupations

5 : Skilled Trades Occupations

6 : Personal Service Occupations

7 : Sales and Customer Service occupations

8 : Process, Plant and Machine Operatives

9 : Elementary Occupations

71

6/ Tourism and Visitors

The contribution of most economic sector to the SLP sub region has been recorded in detail

in most of the previous documents produced for the area and in the previous sections of this

assessment, however, since the SLP came into being a truly regional picture of the impact

and potential of this particular sector (tourism and leisure) has not been undertaken. In

addition to this, it is also recognised that this sector, potentially more than most, has the

future capacity for job growth, a diversity of employment potential and a level of employment

potential that could offset declining labour markets where the sub region is most vulnerable.

6.1/ LDA Figures and Models

The LDA has produced a Tourism Impact Model that attempts to allocate the value and

weight of this sector to each borough.

“Because tourists use such a wide variety of products and services during their stay

(including accommodation, food and drink, taxis and transport, theatres and museums) it has

always been difficult to determine the value of tourism accurately, and particularly at the sub-

regional and borough level.

The London Development Agency's (LDA) Local Area Tourism Impact (LATI) model takes

London-level data from the major national surveys (International Passenger Survey, UK

Tourism Survey) and new data on day visitors from an omnibus survey, and distributes it

across the boroughs.

The results provide borough-level estimates of tourism volume and value to inform tourism

policy development, investment and marketing.” (LDA – LATI 2010).

The modelling represents figures for each borough which are described as experimental

statistics and do not include business travellers. In addition, tourism spending does not

include any share of overseas fares to UK carriers for London or imputed rent which together

amount to an estimated £1.1 billion.

Table 6.1 shows the result of this modelling for all boroughs in London ranked by „Total

Spending‟ for 2007. These are the latest disaggregated and consistent figures across all

London boroughs.

Table 6.1

All London Borough Visitor Numbers and Spend 2007 (LATI Figures)

All numbers are in thousands

Day Visitors

Day Visit Spending

Overseas Over night Visits

Domestic Over night Visits

Total Over night Visits

Overseas Spending Overnight Visits

Domestic Spending Overnight Visits

Total Spending

Greater London 181000 12184000 15300 10100 25500 8192000 2204000 22580000

Westminster 46600 3135000 5500 3500 9000 2927000 762000 6824000

Kensington and Chelsea 12900 866000 1800 1100 2900 986000 240000 2092000

Camden 11600 782000 1100 700 1800 589000 162000 1533000

Hammersmith and 6900 465000 300 300 600 183000 62000 710000

72

Fulham

Southwark 7300 490000 300 300 600 162000 55000 707000

Hillingdon 4300 291000 600 400 1000 326000 80000 697000

City of London 5600 378000 400 300 700 240000 64000 682000

Barnet 6700 451000 300 200 500 162000 37000 650000

Lambeth 6400 432000 300 300 600 148000 65000 645000

Tower Hamlets 5800 392000 300 300 700 176000 76000 644000

Ealing 5800 392000 400 200 600 191000 42000 625000

Croydon 5100 343000 300 200 500 162000 42000 547000

Islington 3900 256000 300 200 500 144000 45000 445000

Bromley 3978 267794 243 143 386 129591 31077 428462

Wandsworth 4185 281668 216 128 344 115260 27753 424681

Enfield 2850 191828 253 175 428 135020 38120 364968

Kingston upon Thames 3335 224487 208 114 322 110968 24849 360305

Havering 3041 204712 226 151 377 120530 32926 358168

Hounslow 3245 218403 208 111 319 111329 24129 353861

Newham 2286 153887 249 214 462 132772 46481 333140

Merton 3650 245687 128 79 207 68335 17270 331292

Brent 2711 182482 182 114 296 96975 24784 304241

Greenwich 2999 201850 145 96 242 77546 20939 300335

Richmond upon Thames 2609 175628 167 124 291 89109 26899 291636

Bexley 2237 150545 151 102 254 80822 22223 253590

Haringey 2345 157853 140 82 221 74649 17756 250258

Redbridge 2183 146951 153 93 246 81956 20156 249063

Harrow 1993 134135 171 97 267 91218 21003 246356

Waltham Forest 2017 135779 110 68 178 58504 14799 209082

Hackney 1864 125448 121 81 202 64761 17583 207792

Sutton 1904 128153 115 70 185 61409 15160 204722

Lewisham 1701 114497 115 77 192 61272 16842 192611

Barking and Dagenham 1029 69233 66 45 111 35208 9861 114302

Source: LDA – LATI 2010

As can be seen from Table 6.1, of the boroughs within South London, Croydon ranks the

highest in terms of visitor numbers and spending during this period and Richmond and

Sutton rank the lowest.

The problem here is not just the methodology, which can be seen at:

http://www.lda.gov.uk/publications-and-media/publications/lati.aspx it is also the manner in

which the data is represented and the actual visitor numbers for major attractions within the

South London area that this data does not equate to.

By representing the data in such a disjointed, borough by borough, manner it does not take

account of the potential flows and links between them or in fact the links within the wider City

Region that flows out to the rest of the South East. Therefore it does not provide a useful

strategic overview of the actual tourism patterns within the City Region and merely reiterates

the fact the most people visit Westminster Abbey.

http://www.lda.gov.uk/publications-and-media/publications/lati.aspx

73

6.2/ A Strategic Regional View of the Tourism and Leisure Industry

If a more strategic overview were to be presented as in Figure 6.1 it would clearly

demonstrate, for example, that within the South West quadrant of the City Region there are

three of Europe‟s biggest theme parks, run by the world‟s second largest entertainment

company (behind Disney) with a combined annual attendance of close to 4.5 million.

And as the actual figures for the South City Region also show (Table 6.2) for the attractions

that are physically located within some of the South London boroughs, the visitor numbers

have been underestimated, particularly in the case of Richmond.

Table 6.2 Top Tourist Attractions in the South London City Region 2007

Attraction Annual Numbers

London Eye 3250000

Legoland 1900000

Thorpe Park 1800000

Kew Gardens 1354928

Chessington World of Adveture 1300000

Windsor Castle 1100000

South Bank Centre 1000000

Hampton Court 473013

Brooklands Museum and Mercedes Benz World 318000

County Hall 300000

Wetland Centre 223000

Battersea Dogs Home 105000

Hayward Gallery 100000

Battersea Park Children's Zoo 95711

Ham House 72254

Wimbledon Lawn Tennis Museum 54590

BFI Southbank 50000

Chislehurst Caves 42475

National Archives Museum 39532

Museum of Rugby 32000

Wandsworth Museum 27484

Down House 27348

Florance Nightingale Museum 26464

Pump House Gallery 21000

Vauxhall City Farm 15000

Marble Hill House 5230

Royal British Legion Poppy Factory 4796

Museum of Garden History 3000

Strawberry Hill Walpole House 2000

Lambeth Palace Library 2000

London Sewing Machine Museum 1700

Royal Military School of Music 1250

Total 13747775

74

Major Parks

Richmond Park 3500000

Bushy Park 1000000

Battersea Park 1500000

Total 6000000

Total 19747775

Source: Visit England (2006-2007)

But these are minor points considering the total numbers of visitors that are actually coming

into this Southern part of the City region, and particularly the South West quadrant of this

area. It must also be noted this does not include business tourism, event tourism

(Twickenham, Wimbledon, Sandown, Kempton, Epsom, Ascot, Boat Race) and general

leisure activities/visits to the River Thames, smaller parks/open spaces and smaller

attractions (which are listed in Table 6.3).

Table 6.3

Smaller Attractions within the South London City Region

Bocketts Farm Park

Carew Manor Beddington

Carshalton House, Water Tower and Historic Gardens

Clapham Art Gallery

Crofton Roman Villa

Croydon Airport Visitors Centre

Croydon Museum

Crystal Palace Museum

Crystal Palace Park Farm

Deen City Farm and Riding School

Fairfields Hall

Honeywood Heritage Centre , Carshalton

Horniman Museum and Gardens

Jurassic Encounter Adventure Golf

Kingston upon Thames Museum and Heritage Service

Kneller Hall

Little Holland House , Carshalton

Morden Hall Park

Museum of Richmond

Puppet Theatre Barge

Soseki Museum in London

Southside House

The Couper Collection

Wandle Industrial Museum

Wimbledon Museum of Local History

75

Wimbledon Windmill Museum

Source: Visit England and Primary Survey

The South London and the London Strategic Tourism plans do not make this larger

connection or observation and as a result these numbers and visits tend to be managed in a

disjointed and isolated way. Ignoring the possibility for linking these attractions and events

within the City Region and strategically offering packages, support and marketing that would

and could exploit these opportunities to their full potential: feeding into the rest of the tourism

and leisure related economy, particularly cultural events, food and drink, accommodation,

sporting activities and events, transport and retail.

This is especially highlighted by the extremely poor cross boundary public sector transport

links (Kingston Core Strategy) that limit mass transit options beyond the GLA boundary.

This is a particularly important point as this sector and its related sectors offer a wide range

of employment opportunities to those with a variety of experiences and skills and do not

simply rely upon highly qualified/high income labour, which is an essential ingredient within a

sub regional economy that needs to tackle pockets of worklessnesss as well as offering

more localised opportunities for high earners that might want to stay and maintain their

existing lifestyle within the City Region.

Figure 6.1 clearly shows the density, range and significance of this sector for the SW

quadrant of the City Region in terms of attractions from across the spectrum.

Figure 6.1

All Tourist Attractions Across the SW Quadrant of the London City Region

76


77

7/ Business Issues in South London This section, produced by South London Business, covers the critical issues business face

in the sub region and outlines the state of the economy and its potential from the point of

view of its private sector members. It is a mixture of both quantitative and qualitative data

and represents the most current picture available on demand and supply issues within the

sub region.

7.1/ Investment levels – business retention

Information on business retention in the sub-region is provided below using data from the

investor development programme (formerly known as business retention) run by South

London Business from 2007 to 2010. As can be seen in the tables 7.1 to 7.4 below,

Richmond (14 projects, 41% of businesses successfully supported), Croydon (9, 26%) and

Lambeth (4, 12%) based companies required the most support over the period 2007 to 2010

(34 projects over the timeframe, see Appendix ? for more detail). The sectors which received

most support were hospitality (8 projects, 24% of businesses successfully supported),

followed by retail (4, 12%) and creative (4, 12%).

In terms of jobs created versus safeguarded there were more jobs safeguarded over the

three year period – at 1930 jobs in 23 projects, than projects involving new jobs created at

592 new jobs in 18 projects. The boroughs of Croydon (354), Richmond (83) and

Wandsworth (73) were the greatest recipients of jobs created, whilst jobs safeguarded were

highest in Croydon (1630), Bromley (120), and Richmond based companies. Sectors

creating the most jobs were: retail (295), hospitality (126) and leisure (70), whilst sectors

most in need of jobs being safeguarded were finance (1200), services (400) and hospitality

(109). This data provides a useful indication of the sectors both growing and those sectors in

need of support during these difficult economic times. We need to bear in mind however that

there are organisations out there it is not always possible to reach in time before the

company goes under or they choose not to accept our support. So this information needs to

be considered in line with other information sources on the state of sectors within south

London.

Table 7.1

Investor development (business retention) successes 2007

Borough Nos Sector Nos

Croydon 3 Training 1

Richmond 1 Banking 1

Bromley 1 Leisure 1

Finance 1

Aviation 1

5 5

Source: South London Business investor development programme, 136 jobs created, 1300 jobs safeguarded

Table 7.1



Croydon 2 Services 1

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Lambeth 1 Retail 1

Hospitality 1

3 3


Table 7.3



Lambeth 2 Creative 4

Richmond 13 Hospitality 6

Bromley 1 Sports 1

Sutton 1 Environment 1

Croydon 3 Training 2

Lewisham 1 ICT 2

Wandsworth 1 Services 1

London 1 Retail 2

Architects 1

Education 2

Publishing 1

23 23


Table 7.4



Lambeth 1 Property 1

Wandsworth 1 Hospitality 1

Croydon 1 Retail 1

3 3

Source: South London Business investor development programme, 110 jobs created

7.2/ Investment levels – Inward Investment

Information on inward investment levels from 2007 until 2010 for south London is provided

below using Think London data and UK Trade & Investment data (note: financial year

2009/10 data yet to approved so not admissible).

Over the past three years, inward investment (international companies supported by Think

London to set up a new base) into South London increased dramatically in terms of jobs

during 2008 (497) and 2009 (166) compared with 2007 (129), whilst the number of actual

companies supported did not change so dramatically (see Appendix 4). Although the

majority of businesses supported tend to be smaller investments, there has been a slight

change over the period with an increase in the number of larger initial investments (by jobs)

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in south London. In terms of locations it can be seen that Richmond with nearly double that

of other recipients (15 companies, 32% of successes), followed by joint second Croydon and

Wandsworth (8 companies each, 17% each) were the most popular boroughs for receiving

inward investment from 2007 to 2010 (47 company successes). Of the 47 successes, the

strongest sectors during that period for inward investment were ICT (17 companies, 36% of

successes), followed by retail (7 companies, 15%), and leisure & entertainment (5

companies, 11%), with the remainder of the successes evenly distributed amongst other

sectors. Countries investing in south London predominately came from the USA (14

companies, 30% of successes), followed by Australia (7 companies, 15%) and Korea (6

companies, 13%). This ratio of country successes could be attributed in part to the clusters

of these communities in the south London area.

Sutton borough did not receive any inward investment during 2007 to 2010 through the

Think London programme, this area has experienced some difficulties in raising its profile &

attracting businesses in the past compared with surrounding boroughs. It is worth also noting

the increase in activity in Wandsworth which could be attributed to the fact that in 2008 and

2009 Wandsworth council arranged a number of events aimed at raising the areas profile,

and recently announced that (2008) the US Embassy and (2009) H&B Foods Ltd are

relocating to the Nine Elms area, which are in addition to Think London successes. (See

Appendix 4 for more details).

Pan-London data on inward investment sourced from UK Trade & Investment for the past

three years (2007-2009 see Appendix 4 for more details), shows that the south London

country of origin investor trends are broadly in line with pan-London with United States &

Australia being the top investors, with the exception of India showing a stronger focus pan-

London (9% of successes) and Korea a stronger focus in south London (13%).

Table 7.5

UK Trade & Investment data for London - new investment, mergers, aquisitions and expansions (Jan 2007 - Mar 2009).

Country (top ten)

No of companies

United States 392 37%

India 92 9%

Australia 65 6%

Canada 57

Japan 50

Italy 48

France 47

China 31

South Korea 27 3%

Germany 24

Total of all projects 1060

80

Source: UK Trade & Investment, This data includes both involved and non-involved

completions by regional agencies.

The principal sectors new investor companies, over the past three years, are involved in

pan-London compared with those investments in south London vary quite significantly with

the exception of ICT which remains the top sector for investors into London & South London

(see table 7.6). There the paths diverge with pan-London‟s top source of investment coming

from the fields of business & consumer services (16% of successes), followed by creative &

media (9%), whilst the retail, and leisure & entertainment sectors, which feature heavily in

south London, are not in the pan-London top ten.

Table 7.6

UK Trade & Investment data for London - new investment, mergers, aquisitions and expansions (Jan 2007 - Mar 2009).

Sector (top ten) No of companies

Software and Computer Services Business to Business (B2B) 240 23%

Business (and Consumer) Services 167 16%

Creative and Media 95 9%

Financial Services (including Professional Services) 77

Financial Services 75

Communications 48

Electronics and IT Hardware 39

Food and Drink 37

Clothing, Footwear and Fashion 30

Healthcare and Medical 30

Total of all projects 1060

Source: UK Trade & Investment, This data includes both involved and non-involved

completions by regional agencies.

7.3/ Export Patterns

Using data from South London Business‟ annual survey and anecdotal evidence from

partner organisations we are able to provide some information on south London companies‟

export experience.

Exporting would seem to play a role, with 30% of firms intending to export. Europe remains

the biggest anticipated growth area. In a recession this is not an easy objective to achieve.

If, or when the economy starts to improve, delayed investment decisions will have an impact

and bank finance may be sought to realise the growth strategies. The longer the recession

continues, the harder it may become for firms to find the skilled staff necessary to implement

their growth strategies as these are the very staff they may well have been forced to make

redundant in order to reduce wage costs. Furthermore, the role of the banks in funding

investment will be critical. While for many firms survival is „the only game in town‟ at present,

senior managerial resources will need to be diverted to planning and preparing the business

for future growth. For many firms this is a luxury they cannot at present afford.

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The main export markets are Europe, followed by North America and then Asia. Of note is

that 30% of the firms do intend to export and the biggest growth area appears to be Europe.

However, it is worth noting there are some success stories:

Bryan Treherne and Neil McAllister have been running training workshops for start up/small

established businesses to trade internationally. They also organise Trade Visits overseas.

There are plenty of people researching whether to trade internationally. This is generally due

to redundancies/retirements and is more biased to ethnic groups not only in Croydon but

across South London. However there is a wide range of products and services available and

most want to trade with their indigenous countries. They recently took a party of twelve

businesses on an Export Drive to Ghana. They were well received and there is huge

demand for British products and services in emerging countries. In fact one Croydon

Business has returned to follow up securing a potential order worth £1m+.

Source: Neil Mcallister, International Trade Training Services

Over the last 15 years the South London Export Club has seen an increase in the number of

South London companies exporting and an increase in volume of the companies already

exporting. It has been noticeable that many companies have started exporting because of

the lack of business opportunities in the UK. They work with Mott McDonald who export their

services to many different countries who continually find new markets in order to use their

skills and knowledge to help infrastructure in many developing countries. SLE from South

Croydon export over 70 % of their manufacturing to countries which include Russia and in

fact now have a factory in Russia manufacturing some of their products. Martek from New

Addington who refurbish cinemas etc, have done well in Europe because of the low value of

the Euro. Centronics again from New Addington are actively selling their detection

equipment worldwide despite USA competition.

Because of the advent of more global players many of our South London Exporters compete

with them at overseas exhibitions e.g. Medica in Duesseldorf in order to be in the forefront of

technology. One of the problems South London has is the lack of skills required to construct

these products and local colleges are not helping by not supplying suitable training courses

in these topics. Over the last year the South London Export Club has seen many new

companies come along to training courses on basic exporting trying to take products into

overseas markets quickly. The South London Export Club expects that exports will continue

to help South London businesses stay “alive” during this difficult time.

Source: Bryan Treherne, UK Trade & Investment and South London Export Club.

7.4/ Enterprise & innovation

KNOWLEDGE CONNECT is a practical programme that's helping London's businesses

succeed by introducing fresh ideas, new knowledge and practical skills to help them realise

their goals and ambitions.

This funded programme gives access to a variety of support including one-to-one contact

with experienced mentors who understand issues relating to business, and access to

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bespoke specialist support through connection with London's world-class knowledgebase of

universities, colleges and research organisations.

Feedback gained from a key mentor at Knowledge Connect: Generally a lot of businesses

(on the programme as a whole) do not have basic elements in place such as a business

plan, and often are very caught up in the day to day work to the detriment of making longer-

term, strategic decisions. Working on projects with an academic partner often leads to

further projects and ideas developing, as they realise the benefit of working on more

strategic changes such as new products/services, new markets, new processes, etc. On the

Knowledge Connect workshops programme the most popular events are items such as

learning to present themselves and the business (which they do with the Central School for

Speech and Drama and the Royal Academy of Dramatic Arts), writing business plans and

product pricing/development, as well as more sector-specific events. Companies often

overcome their initial reticence once they have experienced a successful project, which is

why the Knowledge Connect programme has been positive in „hand-holding‟ that first

experience so that companies enjoy and understand the value of working with academics.

They then often go on to fund their own projects and do further work. It also gives them more

confidence when they approach new markets/customers as they can speak with authority

about projects undertaken/changes they have made.

Source: Melissa Addey, Knowledge Connect

7.5/ Business constraints to business investment & economic growth

A total of 10,000 surveys were distributed to businesses across South London (Croydon,

Bromley, Richmond, Kingston, Merton, Sutton, Southwark, Lambeth, Greenwich, Bexley,

Lewisham and Wandsworth) via online and postal campaigns, business advisers and

business events in June and July 2009. The surveys were sent to top companies ranked by

turnover and number of employees as well as a representative sample of small and medium

sized businesses in the region. A total of 370 completed surveys were returned – a response

rate of 4%. 25% of the responses were located in Croydon, 22% in Bromley, 8% each in

Kingston and Richmond, whilst Merton, Lambeth, and Greenwich all attained around 5% of

completed surveys each. Although businesses were targeted evenly across south London, it

is interesting to note the strong response from businesses based in two of the boroughs –

Croydon and Bromley. The precise reason for this is unknown, but may be attributable to

stronger business engagement or more vocal businesses in those locations.

Location: Costs are a problem both in terms of premises and rates. Business rates have

become highly topical this year – the reduction of business rate relief on empty commercial

properties in April 2008, and the Chancellor increasing the business rate multiplier by 5% in

April 2009 have all affected business‟ bottom line. This will not be aided by the impending

2010 rating revaluation and the additional 2p levy on the business rate (per pound of

rateable value) on non domestic properties in the capital with a rateable value of £50,000 or

more to fund Crossrail. In addition, poor transport links, the local environment and crime are

issues. It is conceivable that if the local environment deteriorated markedly the pull of being

near customers would start to be eroded and firms would look for other more pleasant

locations.

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The top issues that respondents felt need to be addressed were:

rising business rates

cost of premises

transport links

local environment

crime

Given that many respondents reported that the quality of life afforded by the area was an

important pull factor, deterioration in the local environment could lead to firms re-locating

outside of the area. In addition, improvements in the availability of business support, help in

raising finance and access to markets could help a sizeable percentage of local firms.

Areas of concern for business were predominately around:

Property – lack of suitable / struggling to find: particular issue in Croydon, Richmond

and Sutton.

Planning - throughout South London, slow development of sites in Croydon –

Canehill / Ruskin Square.

Poor transport links – seemed to be more of an issue for Bromley and Kingston

companies

Skills – engineering & aerospace in Bromley, technical, ESOL, young people,

construction, chefs, ITC.

Staff redundancies

Recruiting and retaining staff – competing with central London for staff

Congestion – spread throughout South London

Car parking – more prevalent in Bromley

High housing costs for staff – Richmond

Environmental support

Lambeth no local chamber – not prevalent enough.

Business support confusing in Croydon

Low emission zone

Safety & crime (inc flytipping) – Croydon, Hackbridge and Lewisham

Residents – unhappy about industrial sites in residential areas.

Environment

Public sector procurement

New business – networking: requested particularly in Richmond and Croydon

Apprenticeships

Training – management skills in the areas of customer service, supervisory, e-

commerce, marketing, communication, and some specific courses related to food &

drink sector.

Funding – particularly requested in Richmond and Croydon.

7.6/ Assets of the sub-region

The first thing to note is the high level of satisfaction firms continue to have with the location

at 75%. The main reason businesses choose to be in South London is because South

84

London is where their customers live and work. Also important is the quality of life offered by

the location.

The main reason firms were located in South London was because of access to

markets/clients, followed by a range of “other” reasons (mostly divided between historical

reasons or senior staff living in the area), and then quality of life.

Figure 7.1

Reasons for Locating in South London

Source: SLB

Businesses in Bromley and Croydon were more likely to mention business support

infrastructure in the region as an asset, Kingston and Croydon cost of commercial premises,

and quality of life in Richmond. As the high cost of commercial premises is cited as a current

difficulty it is no surprise to find that only about 11% of firms reported that they were located

in South London because of the quality or the cost of commercial premises. Also labour

costs were hardly mentioned at all as an attractive feature of the area.

Other key issues raised by businesses were Biggin hill airport – good for attracting corporate

to the area, Purley way good for industrial, transport in relation to central areas such as

London Bridge, high skill base in Richmond & Croydon, economical offices, Kingston

Business Improvement District and business base in Croydon and Kingston.

7.7/ Engagement with sub-regional partnerships and support

Accountants, banks and solicitors were the most common sources of advice. Interestingly

more informal sources were important – other business owners and friends or relatives.

Other important sources of advice were obtained from trade or professional associations,

Business Link and the Inland Revenue. Just over 10% reported using management

consultants. Businesses were unaware of the savings they could potentially make in a

85

number of areas including production management, purchase management and sales

management. Given the pressure that is on businesses at present exploiting sources of

advice and help that they have not traditionally considered to weather the current financial

climate such as management consultants and businesses specialising in business

efficiencies may well be worth looking into. This said about 40% of the businesses indicated

that they would be willing to attend free seminars run by Barclays and free support from

Train to Gain. Against this relatively few reported interest in being contacted by the survey‟s

sponsors for help.

Specific support mentioned included Soloman; Bromley college; Merton, Kingston, South-

East London and Croydon chamber; South London Freight Quality Partnership; Business

Focus, West Focus, local councils, Envibe, Job Centre, and the LDA.

The majority of businesses welcomed further introductions to chamber, local councils and

other specialist support organisations such as Soloman. They were also keen on a number

of the SLB skills programmes and networking opportunities in particular, as well as some of

the cluster programmes such as Build South London.

7.8/ Sites and Property

Table 7.7 lists the key development sites in South London that the business and policy

community feel will bring significant capacity to the area and enhance its overall appeal for

future inward investment.

Table 7.7

Key Development Sites

Borough Positive - growth Negative / no development

Comments

Bromley Two major development areas of 26.6 acres in Beckenham and Bromley town centre. Huge potential if filled by employers, in terms of employment and impact on surrounding areas – demand for other services.

Only just become available

Croydon Great potential for growth. Nine large sites highlighted

Some of these sites have been discussed for a very long time such as Cane Hill, Park Place and Ruskin Square (formerly the Gateway). Unfortunately because some of these sites have been the subject of planning disputes, the areas around these developments have declined e.g. Dingwall

If these developments actually come to fruition they will truly have a huge impact in terms of employment, and demands for other services related to a new business setting up in the area – office services, recruitment, local amenities etc...

86

road, St George‟s Walk and some businesses have left the area as a result of these delays – i.e. limited new office space and deteriorating environment.

Kingston Three sites – offers some good potential

Some of these sites, such as the Tolworth one have been in discussion for some time, and do have some limitations such as the A3 / A238 access and risk of congestion, and land-banking by Tesco‟s of one of the sites.

Merton Five sites – some good potential large sites.

Some of these sites have limited public transport access which may have caused difficulties as employment sites. Two of the sites are converting to predominately residential use.

Richmond

Six sites mentioned in local development framework

The Core Strategy was adopted on 21 April 2009, following recommendation by Cabinet on 23 March 2009 and full Council on 21 April 2009. There is a new inward investment post who could leverage these sites when promoting the area as part of their new role.

Sutton Two sites – smaller sites than other boroughs but still potential.

One of the sites is veering towards predominately residential use.

Appear to be a smaller number of opportunities than other boroughs.

Wandsworth Five big sites – lots of potential – some great success stories recently (see inward investment: H&B Foods, US Embassy)

Some sites such as Battersea Power Station have been discussed for a long time – however with the development of the Nine Elms opportunity area and successes such as the US Embassy proposed move to the area – could act as a catalyst to finally get this scheme off the ground.

87

Source: SLB

Demand for commercial property in South London has unsurprisingly seen a decline due to

the economic downturn and its effect on existing and start-up businesses. The South

London Business commercial property database caters to a client base of mainly small to

medium sized businesses, existing or start ups, looking to locate in any of the nine South

London boroughs it covers: Bromley, Croydon, Lambeth, Lewisham, Kingston-upon-

Thames, Merton, Richmond-upon-Thames, Sutton and Wandsworth.

Comparatively the nine Boroughs have seen a steady decline over the past three years in

demand and are yet to show signs of recovery to return back to levels last seen three years

ago. In terms of supply of new premises during the same period (2007-2009) there has been

a steady increase in vacant premises available in South London. However there have been

fluctuations in the types and sizes of premises available in south London from 2007 to 2009

which is particularly noticeable amongst industrial & warehousing, mixed commercial, offices

and retail use classes. Retail premises within South London showed some consistent

improvement trends whilst divergent trends were evident in the other premises use classes.

Generally, the availability of new vacant properties available in South London has steadily

increased since January 2007. In January 2007 95 new properties were supplied by agents

to be marketed on the database, the lowest trough in the chart was in December 2007 where

44 new properties were supplied. New property uploads peaked at 353 properties in April

2009. This increase in vacant properties indicates a correlation with the economic downturn.

In general take up in South London has not matched supply of vacant space subsequently

resulting in disequilibrium of supply and demand.

Figure 7.2

Supply of New Vacant Property Jan 2007 – March 2010

Source: SLB

Collectively the South London Business property database data shows a decline in property

downloads commencing in the summer of 2007 (the start of the downturn in commercial

050

100150200250300350400

Jan

-07

Mar

-07

May

-07

Jul-

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Sep

-07

No

v-0

7

Jan

-08

Mar

-08

May

-08

Jul-

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Sep

-08

No

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Jan

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88

property uptake) and reaching its lowest trough in October 2008/December 2008. However,

the level of downloads seems to have reached an equilibrium of approximately 600

downloads a month despite an upsurge in the autumn of 2009; reaching 1000 downloads a

month.

A total of 1429 downloads for properties were logged on the entire SLB database in January

2007 as opposed to 695 downloads in January 2010 a drop of 51%. The consistent trend

overall has been a steady decline during the economic downturn.

Figure 7.3

Overall Demand of Property in South London

Source: SLB

The business base searching for commercial property through the property database is

dominated by businesses in the wholesale and retail trade sector which represents 32% of

businesses. This is followed by businesses that fall under the „Other community, social and

personal activities‟ category at 15%. The third largest portion of enquiries is from businesses

that fall under the education sector at 13%. Hotels & Restaurants also represent a relatively

large share of businesses searching for premises at 11%.

Detailed demand and supply for individual boroughs is shown in Appendix 5.

Figure 7.4

Sectorial Demand for Premises

0

200

400

600

800

1000

1200

1400

1600Area Hit Stats Nine South London Boroughs

South London Business

89

Source: SLB

In 2007, almost a quarter of the businesses that used the commercial property database

were from outside of the South London area. This is good news for the region as it indicates

that a quarter of all businesses looking at setting up in the sub-region are new to the sub

region. Lewisham was a high second with 17%, followed by Merton, Lambeth, Croydon and

Wandsworth who all represented 10% each of businesses using the property search facility.

Richmond-upon-Thames was the least well represented; only representing 1% of companies

using the database.

In 2008, levels are consistent to 2007 trends. „Other U.K.‟ has the largest amount of

businesses using the database with 21% followed by Lewisham who have 19%. The number

of businesses in Lambeth and Croydon using the database has gone up marginally;

Lambeth by 2% and Croydon by 3%. Non U.K. companies looking at the database

represented one percent of users, similar to 2007.

In 2009, the trends reflected a number of changes. The top three business origins for

companies searching for premises were „Other U.K.‟ – 19%, Croydon – 18% and Lewisham

Construction5%

Education13%

Financial Intermediation

1%

Hotels & Restaurants

11%

Manufacturing7%

Other community, social and

personal service activities

15%

Public Administration

and Defense4%

Real estate, renting and

business activities

8%

Transport, storage and

communication4%

Wholesale and retail trade

32%

Business Type

90

18%. „Other U.K.‟ had a smaller lead on other business origins than in previous years with

only 1% more than the rest.

There was hardly any change in the percentage share of existing businesses and start ups

looking for premises: 62% were existing businesses and 38% were start up companies.

7.9/ Supply Chains

One of the hardest areas to ascertain information upon is the supply chain network between

businesses and clients in the sub region. The following information represents the best

information available from South London Business and the London Annual Business Survey

(last undertaken in 2007).

There are a number of key sectors in South London, many of which have key connections

with other industries / businesses both in London and the South-East. A brief synopsis of

some of the key sectors and their connections are highlighted below. This information is

based on feedback from our business retention and inward investment activity, and has

resulted in tailored programmes to support some supply chains such as the Build South

London project, the South London Freight Quality Partnership, and Consolidation centre for

construction sector.

Finance:

Business services companies tend to be located around the boroughs of

Wandsworth, Lambeth, Richmond, Croydon, Southwark and Bromley and some of

the businesses operating in the area include: AIG, Mazars, Mondial, Pegasus

Solutions (Utell) Capita, Pricewaterhouse Coopers, Ernst & Young, Iron Mountain,

Norton Rose, Withers & Rogers, Churchill Insurance, Cosmos Holidays, Bank of

America and Baker Tilley.

There are two small financial intermediation clusters in Southwark and Bromley.

Private equity houses, trading platforms and specialist financial institutions favour

London Bridge including Montagu Private Equity, Hgcapital, Ansbacher & Co Ltd,

IgIndex and City Fund Management, whilst back office functions by Bank of America,

Capita and Liberata are carried out in Bromley and Croydon, in addition to numerous

small to medium sized enterprises involved in financial brokering, advice and

services.

Many companies such as Abbey Life, Hill Samuel, American International Group and

Aviva decentralised from central London to Croydon during the 90‟s to take

advantage of a lower cost environment, whilst still being accessible to clients and

have access to an excellent ICT and transport infrastructure.

Companies in the financial sector in South London can still enjoy the benefits of

being in a lower cost environment, surrounded by some of the key players, and within

easy reach of the city, and Gatwick Airport. This allows companies to be fully

connected to the financial world, and both domestic and international markets. They

tend to carry out back office functions, including disaster recovery in South London.

Note that the business branches in South London will be connected to head office

businesses in central London and dependent on the sector growing in London.

91

Other connections: Because the financial & professional services sector is so

prevalent in south London this leads on to demand for other services such as

marketing, office services and local amenities, so any change in this sector will have

a follow-on effect on other industries which service the financial sector.

Logistics:

Based on the GLA Economics Working Paper 37: London‟s logistics sector August 2009 and

our own experience with businesses under the investor development (business retention and

inward investment) programme we are aware of / have been involved in the following which

emphasis the links between the transport / logistics sector and certain key sectors in south

London such as retail and construction which create business for the transport sector.

South London Freight Quality Partnership:

Role is to find constructive local solutions, which reconcile the need for access to

goods and services with local environmental, social and safety concerns. They

research, develop and implements actions aimed at increasing the operational

efficiency of the freight transport industry, while reducing its impact on the local

environment. They bring together stakeholders from local and regional government,

the freight industry and other key organisations, all with an interest in sustainable

freight transport.

The partnership is supporting all sectors with logistics needs but there is a strong

emphasis on supporting the construction and retail sector.

Construction Logistics Plans are a key initiative identified within TfL‟s London Freight

Plan. Due to significant developments proposed in the Croydon area, the SLFQP

have initiated discussions with Croydon Council, logistics providers, some of the

relevant developers and their lead contractors to establish how the effects of the

construction phase of these developments can be best managed through best

logistics practice. SLFQP have also recently opened discussions with several of our

member Boroughs regarding broader application of Construction Logistics Plans in

the context of the development of the Town Centre Area Action Plans that have been

developed in several cases.

A study (June 2008) was carried out in the use of consolidation centres for the retail

and construction sectors which would play a key role in improving freight efficiency,

environmental and economical performance in South London. The study suggested

that suitably located consolidation centres, where smaller part loads are grouped

together onto a single vehicle for the final delivery leg, could help alleviate congestion

and the environment and improve efficiency of the local economy and directly

supporting the retail sector.

In South Bermondsey has been funded by Transport for London (£1.85m), Stanhope

and Bovis Lend Lease (£1.35m) and managed by Wilson James. A winner of the

European Supply Chain Excellence Awards 2006, the LCCC is making significant

improvements to the construction industry's material delivery effectiveness, reducing

CO2 emissions by 75%, increasing productivity by 47%, and for right materials, right

place, right time there is a 70% improvement on industry norms.

Retail:

92

Wholesale and retail sectors are strongest in Croydon, Wandsworth, Bromley,

Southwark, Richmond and Kingston.

See above mentioned logistics sector and Freight consolidation centre for retail

– heavily dependent on retail sector business booming.

Construction – civil and other / Build South London:

Construction expertise is centred on the boroughs of Croydon, Sutton, Merton,

Bromley and Bexley. A sample of these operations in the sub-region include: Mott

MacDonald, TPS Consult, Stonewest, Frankham Consultancy, Kingswood

Construction, Marlborough Surfacing, Faber Maunsell, Haden Building, and EPS

Maintenance.

The impact of the construction sector is large as there are a few large corporates

who win the contracts and then pass on smaller parcels of the contract to sub-

contractors within the region. If the larger businesses suffer because fewer contracts

are being issued (in line with a decline in public sector spending – budget deficit and

only a small recovery in private sector), this will have a heavy impact on the smaller

contractors who often are heavily dependent on the sub-contracts.

Linking into the construction sector is environmental technology as required by

planning rules. There are a number of companies involved in the environmental

sector, with a small centre of environmental excellence in the borough of Sutton,

where BioRegional Consulting is based (provides sustainability consultancy services)

and the Beddington Zero Energy Development (BedZED) in Wallington, the UK‟s

largest eco-village. This is a sector that should be encouraged to grow with South

London‟s strong construction sector and the increasing growth of regulation around

the environment for the building industry.

See above mentioned logistics sector – Freight consolidation centre for construction

- heavily dependent on construction sector business booming.

SLB‟s Build South London project: The Build South London Network is a focal point

for construction activity in South London for both the supply and demand sides – a

route to market for all construction related business support and supply chain

opportunities. The network is led by main contractors, local and regional business

support organisations, the Centre of Excellence, Construction Federations and small

local construction businesses. Procurers have responsibility in stimulating

improvement and change within their supply chains so that as much work as possible

is undertaken by local businesses. By joining the Build South London network, small

and medium size businesses will discover what they need to know and do to

compete more effectively in the supply chain enabling the network to provide demand

led business and skills development support.

Engineering – aerospace:

Within the knowledge sector, companies involved in aerospace, defence and related

industries form an important part of London‟s high-tech capabilities. Due to the

presence of Biggin Hill airport, Croydon airport (no longer operational), and Kingston

as a major military aircraft manufacturing centre for much of the 20th century, there

are a number of companies involved in the aforementioned industries. Companies

include: Thales, Northrop Grumman Sperry Marine, AMS (Alenia Marconi Systems

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owned equally by BAE SYSTEMS and Finmeccanica), Sigma Aerospace, Jet

Aviation and Centronic.

Further examination needs to be conducted to examine whether any of the parts

required from this sector are provided by those involved in manufacturing in South

London. It has been indicated that South London councils wish to preserve its sector

diversity and developing an understanding of the connections here would be helpful.

With the number of airports in the south-east it would not be surprising if much of this

sectors business comes from the regional airports, this would need to be examined

further. It is evident a number of companies on the Biggin Hill estate and in

neighbouring Croydon are aerospace focused so if Biggin Hill airport growth were not

be sustainable this would impact a number of businesses in the local area.

Tourism – leisure, hotels & food:

Hotels and restaurants are focused around the boroughs of Wandsworth, Lambeth,

Croydon, Southwark and Bromley due to excellent transport connections. Key hotel

chains operating in the area include: Holiday Inn, Travelodge, Jury‟s Inn, Marriott,

Park Plaza, Travel inn, and Hilton, in addition to a number of independently run

hotels.

Linking into the hotel sector is food & drink – and companies who supply the hotel

sector. Lewisham and Southwark have a well established food and drink sector. This

is due to the large fresh produce market – Borough Market – in Southwark supplies

locals and the hotel trade, and the numerous food stalls and shops catering for the

West African and Latin American communities in Peckham / Peckham Rye, Elephant

and Castle and Deptford / New Cross areas. Some of the other boroughs in South

London such as Wimbledon and Richmond also have delicatessens who supply the

local hotel trade.

Also linking into the hotel sector is the number of tourist attractions in the area as well

as the business base – without the business users and tourists attracted to the area

– hotels would not do as well. This corresponds if you examine the high number of

hotels based in Croydon to satisfy the business clientele and the high number of

hotels in Richmond / Kingston to satisfy the numerous tourist attractions there.

The success of all three sectors – hotels, food & drink and tourism depends on them

all working together efficiently and effectively to promote south London as a

destination for tourism and a place to stay on business visits.

Figure 7.5

Destination of Sales in Last 12 months

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Source: LABS 2007

As can be seen from Figures 7.5 and 7.6 whilst the companies in the area tend to sell

predominantly within their boroughs and secondly within the Greater London, they tend to

primarily use suppliers from outside their borough (but within the Greater London area)

rather than suppliers from within their boroughs. However, the supplier base is also

significant in the wider South East and elsewhere in the UK.

This indicates that whilst the majority of sales (as expected) tend to be within their local area,

the firms are much more sensitive and responsive to supplier pricing, and will therefore

source from a much broader area. Clearly showing the greater diversity of supplier networks

over the range of customer networks.

Figure 7.6

Source of the Value of Purchases from Suppliers

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Source: LABS 2007

7.10/ Transport

For many businesses in South London the critical issue is transport and from business

surveys and discussions with owners the following are the main challenges and potential

areas for development that will open up the area to future inward investment and business

growth. For a detailed breakdown of all transport schemes affecting the area please see

Appendix 6.

General sub regional Issues

International corporations often establish their logistical operations in South-West

London due to the choice of two major airports, Gatwick and Heathrow, reachable in

half an hour to one hour drive, and the ports of Dover, Felixstowe, Southampton and

Tilbury easily accessible in one to three hours whilst the City of London and its large

consumer base is only is close by.

Five train operators in the vicinity provide connections to the City of London within an

average time of 25 to 45 minutes depending on location.

Other less well-known air transport hubs in the South-West London region include

Biggin Hill airport and a helipad based in Battersea.

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Eurostar travellers have a choice of either St Pancras (20 minutes from London

Bridge by public transport), Ebbsfleet (15 minute drive from Bexley) or Ashford

International stations ( 1 hour drive from Bexley).

Major transport improvements recently completed are the East London line extension

Phase 1 and the Docklands Light Railway extension. Crossrail and the Cross River

Tram are still being anticipated.

7.11/ Skills Issues

Through South London business‟ work on business retention and inward investment, we

have gathered brief details on the major skills issues raised.

Table 7.8

Borough Positive - growth Negative Comments

Across all boroughs SLB supplied training through train 2 gain programme

Training needs – management skills in the areas of customer service, supervisory, e-commerce, marketing, communication, and some specific courses related to food & drink sector. Skills lacking: technical, ESOL, young people, construction, chefs, ITC.

With the recession it seems training has been the first area for businesses to make cutbacks, hence many businesses participating in our government funded programmes in 2009/10.

Bromley / Croydon Engineering & aerospace – always hard to resource as there are fewer students coming out with degrees in this area and the workforce is aging. South London used to have a strong skill base in this area but it is getting hard to find.

Engineering – civil / mechanical: This is a strong sector in Bromley / Croydon and Kingston area with a few large firms employing large numbers of staff e.g. Mott MacDonald – Croydon, Muirhead – Bromley, Sperry Marine - Kingston. If businesses have to relocate to areas where they can more readily source engineering skills, this will have a detrimental effect on south London.

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8/ The Development Capacity of the Sub-Region

This penultimate section has been produced to provide an overview commentary on the

perceived development capacity of the sub region. This moves beyond the simple

representation of the „fact‟ into a level of interpretation based on existing data and research

analysis. It is an independent review of the capacity and the issues affecting it, that are

critical to the long term sustainable survival of the sub region.

8.1/ The Key Issues

The analysis of business activity in the sub-region points to a potential for growth across a

range of employment sectors, retail, leisure/tourism, knowledge services and, in some sub-

sectors, industrial. However, there are many constraining factors. In particular, the majority

of the sub-region is highly developed, so most pipeline opportunities have to be found from

brownfield opportunities or, in the case of residential sites, through windfall opportunities.

Unlike some other urban areas, there is a lack of heavy industry, so most PDL land is not

sufficiently heavily contaminated as to present major development issues, though this is not

the case for all sites.

Development potential of the sub region continues to be hampered by the paucity of cross-

regional infrastructure and by other transport issues, as identified in TfL‟s 2010 analysis. For

example, although Heathrow airport is close to the region and Gatwick lies just to the South,

rail transport to Heathrow is poor and necessitates travel via Central London and although

Gatwick has good links to Croydon, direct links by rail to other parts of the sub-region are

very limited. The proposed Airtrack link - will provide accessibility and possibly occupational

and investment demand within Richmond, thus providing enhanced viability of the key

development sites within this region, but unless cross region links are improved the benefits

are likely to be localised. In considering physical capacity issues, realistically, cross sub-

region transport issues mean that multi nodal settlements is an appropriate strategic

approach and one that fits with the drive towards localism that is arising both from bottom up

initiatives such as the Transition Town movement and from government policies to promote

localism

More of an issue than contamination is that of environmental sensitivity, with increased

emphasis on the needs for ecological protection and promotion of biodiversity. This means

that potential sites, such as the River Wandle Delta, which is currently identified and under

consideration for primarily residential redevelopment, are likely to be strongly resisted;

similarly, within Kingston borough, the possibility of utilising brownfield sites within

metropolitan open space. Such issues may delay the realisation of identified opportunity

sites.

Another challenge to the fulfilment of the identified office development potential of the sub

region is the issue of viability of developments. For example, within the office sector,

potential occupiers may be drawn to the area by the lower rental values when compared with

West End and City/ Canary Wharf rents; however, the level of rents may impact negatively

on the viability of schemes for developers. Further, as residential values revive there is a

real possibility that we may see a return to the situation that prevailed during the mid 2000s

when residential developments became significantly more attractive than office, leading to

office schemes coming under pressure to divert to residential.

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There exists a steady demand across the sub-region for industrial premises; here the

potential loss to alternative use is such that there has been a real need to protect against the

transfer and this policy of retention is identified as critical in the core strategies of several

boroughs in the sub region.

8.2/ Key Opportunity Sites

Within most of the boroughs, key opportunity sites have been identified. Some of these are

vacant and under discussion; others are very much part of the pipeline and subject to likely

delays in coming forward.

The single most strategically positioned development site in the sub-region is Battersea

Power Station (within the Vauxhall Nine Elms Battersea Opportunity Area). Whilst this has

been standing empty and derelict for many years, it is strategic in that, if successfully

developed it will both add significant capacity and, if there is significant retail offer, it may

impact not only on the other centres in Wandsworth but across neighbouring boroughs.

Described as potentially „another Canarf Warf‟ scale of development this area has the

potential to deliver 20, 000 jobs.

Among the most important of the other identified sites in terms of their potential within the

sub region are:

Stag Brewery (Richmond) and Ram Brewery (Wandsworth – but this has recently

had permission refused!) : These two brewery sites are large-scale and undoubtedly

offer the potential to provide significant residential and commercial opportunities.

When completed they may have impacts on neighbouring boroughs. The Richmond

site is particularly important as a „defensive‟ development to help the borough

continue to compete against other inner London developments, such as Westfield

which has recently come on stream

Richmond/Twickenham Station; Bromley South and Bromley North stations

(Bromley); Clapham Station (Wandsworth); Wimbledon Station (Wandsworth)

Tolworth Station (Kingston): One of the key factors coming forward in the

analysis of core policies is the potential that is now identified in and around transport

nodes, primarily railway stations. The idnetification of signfiicant opportunities for

mixed-use and in some case also civic developments underlines the potential to

combine infrastructure iprovments with realisation of development potential.

Star and Garter (Richmond); Old Downs Hospital (Richmond); Surbiton

Hospital (Kingston); Atkinson Morley Hospital (Wandsworth) Redundant or

outmoded and under-utilised hosptial and care facilities have been identified as

signfiicant development sites; however all the three listed above are likely to present

challenges in terms of ecology and biodiversity; additionally Old downs is in a

conservation area and the Star and Garter, is grade 1 listed so redevelopment is not

an option, only appropriate and sympathetic re-use and extension of existing

buildings.

Metropolitan or Green Belt Open Land: sites have been idnetified in Kingston,

Sutton and Wandsworth which are PDL but sit in designated open space land.

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Whilst they offer significant potential, they are challenging sites due to conservation

and flooding issues.

Town Centre Schemes: most of the SLP boroughs have identified signfnciant floor

space potential within their CBDs for either or both retail and offices. These range

from a planned extension to the Glades in bromley to large scale plans including an

innoversity scheme in Croydon to a veriety of sites in Sutton and a complete

redesign of Kingston town centre.

Whilst these large scale sites will undoubtedly be of signficance right across the sub-region,

most present challenges and will be likely to be subject to lenghty periods of consultation

making it very difficult at the current climate to estimate with any accuracy a time-scale for

their incpetion and/or completion. Accordingly, if the SLP is to achieve its ambition of

greater prosperity these large flagship schemes are not the key to success, although

maintaining the competitiveness of the existing town centres and employment capacity is

fundamental to the area.

As this is a desktop study, we have not assessed the capacity wihtin the SLP for the

idnetification of other key sites based on redudant public sector buildings including health

and education and on transport hubs but it is likely that, although some have undergone re-

development in the last decade, they do collectively offer potential opportunities.

8.3/ Key Capacity Considerations

In looking further at the capacity, it is relevant to restate some of the strengths and

weaknesses of the sub-region. Key capacity considerations are:

The need to meet housing targets which are very variable across the area;

A need to preserve the undoubted strength in industrial land provision to ensure

employment;

A perceived mismatch between the quality of supply of offices and the emergent

demand and a desire to bring in employment to reduce the levels of commuting

both to central London and to outer areas;

A need to maintain the competitiveness of the region in terms of retail and

leisure/cultural offer in the light of increasing competition from outside

developments.

The capacity to achieve these objectives aside from the realisation of the flagship proposals

listed above is now considered.

8.4 Residential

The targets for residential developments are extremely variable across the SLP area.

Figures given in Core planning document reveal the following

Table 8.1

Housing Requirement Targets (15-20years)

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Bromley 11.458

Croydon 19,000

Kingston 3,850

Merton 4,800

Richmond 4,050

Sutton 5,175

Wandsworth 11,250

Source: Core Documents

Against these very variable targets there are differing degrees of optimism in terms of ability

to deliver. Croydon has the most ambitious requirements, with a need to develop 19,000

new homes by 2031. They estimate (Croydon 5 year plan) that they currently have a total of

some 8,100 units that could be developed from existing identified sites, which meets the 5

year target, but whilst identified capacity exists in the short term, but over the longer period

there may be shortfall in the longer term. All future sites will have to come from PDL and,

given the remaining policies, it is important that a drift from employment to housing does not

accelerate. This presents a real tension.

Further, closer examination of schemes within the MTC reveal that the predominance of

future supply is likely to be in the form of flatted developments, mainly 2 bedroom units. Very

little family accommodation within 3 bed flats or within houses is identified. Few identified

units show provision for ancillary services, such as crèche or medical/healthcare. The

identification of additional residential is therefore for single/couples rather than for family

accommodation. Whilst this provision ties in with the projections of Croydon‟s future

population growth being largely not stable family units, if the future stock is so concentrated

this will have an impact on the services required and on the type of retail development that is

likely to be viable. Over the longer term, for prosperity to be maintained an enhanced, future

housing provision will have to allow for more family units and affordable provision.

In contrast, within Richmond, the estimated increases for residential units is modest, with the

main areas of increased provision being within Richmond itself (700-1,100 units),

Twickenham (700-1.100 units) and Teddington/Hampton (700-800 units). Given the

proliferation of conservation areas (Richmond has some 72 conservation areas) which both

acts as a pressure for, but restrictions on developments and a general lack of large vacant

sites, most additional stock must come from either redevelopment at higher density or

through windfall. However, recent changes to PPS 3 introduced by the coalition government

in relation to back garden developments will reduce the stock of windfall sites moving

forwards.

Analysis of Merton‟s opportunity sites reveals total pipeline of less than 3,500 units. Of these

the best estimates are for some 510 units within 12 months and then a steady flow over the

following decade. A key feature of the pipeline is that many of the identified sites are small;

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only 1-5 dwelling projected and only 10 sites are likely to yield in excess of 100 units per site.

Some major sites exist including around Wimbledon Station and closed facilities such as

Atkinson Morley Hospital but there is undoubtedly limited scope for major additions, unless

associated with the loss of community (schools and hospitals) or employment sites. Merton‟s

longer term housing trajectory indicates that whereas there are identified sites to

accommodate next 5 years there will be a dependence on windfall sites thereafter.

In Bromley, targets are much lower, and the proliferation of sites for mixed use in and close

to the town centre give some level of confidence that the supply target can be met.

However, within mixed-use schemes most residential is flatted and it is possible that the type

of accommodation may not meet residential occupier preferences. Similarly in Kingston,

which has seen major developments such as Charter Quay in recent years, it is estimated in

the Core Strategy that the identified sites, which are focused on the town centres of

Surbiton, New Malden and Tolworth and the area south of Tolworth will enable targets to be

met.

In summary, the position across the sub region varies. There is the potential in most

boroughs for the next 5 years at least. However, there is concern about the amount of

affordable housing that will be delivered and, with some boroughs concentrating residential

provision in mixed-use town centre schemes, balance of type of housing could become a

longer term issue. Unless the developments are appropriate to support the developing

needs of the population, then economic prosperity cannot be assured. Further these areas

are for the most part high value and attract residents for the quality of the housing stock, the

suburban experience and in many cases living within historic and protected environments.

Delivery to match these aspirations will be important. In the longer term windfall sites, back

land sites and possibly loss of open space may be needed to accommodate targets.

8.5/ Offices

The London Office Policy Review (GLA/Ramidus) points to poor prospects for offices within

the sub-region, as the size of government requirements decrease, major schemes

concentrate in diverse sites across Central London (mega developments) and back office

functions move to remote, even offshore, locations. Overall this report suggests little need

for significant growth within the office provision across the sub region. But this is obviously

based on a very localised perception of existing circumstances and does not take into

account a range of factors, particularly the need to create sustainable decentralised growth.

in terms of the potential to increase the prosperity of the region, analysis of Core Strategies

point to a slightly different picture and indicate that there is a shortage of good quality office

accommodation in most boroughs; for example in Wandsworth a report by DTZ identified a

current undersupply but potential through current allocations to yield almost ½ million sq m

of floorspace which they conclude should on current take up ensure sufficiency of supply.

A common feature running through most of the boroughs is that the office stock is old, low

quality and often units are too small to attract incoming high skills businesses. This is

particular noted in Croydon, Bromley and Richmond, all of which have very good

connections to Central London and against whom they compete.

Further evidence of demand for commercial premises lies in the vacancy rates. Whilst these

are variable across the sub-region, CLG‟s review of commercial vacancies rates figures

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gathered prior to the recession revealed that vacancies rates were generally low.

Wandsworth and Bromley recorded the lowest rates (4% and 5% respectively) with Sutton

and Croydon being highest at 10% but still below the 11% average for London. Since the

recession, rates have risen and, for example, it has been estimated that in Merton alone the

rates have approximately doubled to some 15% for offices, but this is considered to be in

line with commercial markets generally

However, the low rents (£15-20 sq ft) and marginal development viability mean that that

some potential employment sites are under pressure for change to residential, thus further

potentially weakening the pipeline for increasing employment. There has therefore been

identified a need for good office (B1) development sites which would support significant

developments in areas that have appropriate transport links i.e. close to railway nodes.

Elsewhere refurbishment of existing space to good standard is a more feasible way on

delivery.

Analysis of the potential development pipeline reveals that there is considerable capacity

cross the sub-region. Within Croydon: significant opportunities sites close to the town centre

with proposals for high rise offices notably in George Street and Cherry Orchard Road, in

well connected sites to replace outdated post-war developments. It was identified in the

PACEC report that Croydon had potential for between 111,300- 181,000 sq m of new

floorspace (p.61). Whilst this estimate is historic, little development has taken place during

the downturn and there is a significant pipeline possibility within the core central district.

However whilst the schemes currently either with consent or under discussion, would

provide significant new high quality office developments, this addition to office stock is at the

expense in part of industrial users; further some potential office sites are now more likely to

be developed out residentially.

One of the features of some of the boroughs is the high percentage of those employed within

the creative industries. This is a feature within the Croydon and those boroughs lying to the

West (Renaisi, 2008). To service these industries, it is important that a stock of small „start

up‟ sized office units remains available. As there remain significant amounts of secondary

space, this offers the real potential to continue to foster such start ups. Additionally,

refurbished space is equally appropriate for start ups so some confidence can be given in

the pipeline moving forward.

Kingston, which is less well located than Richmond and Wimbledon for offices due to weaker

connections to Central London has been identified as an area of static rents and where

there is a demand for and need for small spaces for start up businesses.

Within Richmond, the supply of office space is fairly static (URS, 2009p 33) and there are

very few pipeline sites for large scale office developments (Crane Valley), and generally a

shortage of high quality stock. The solution to this is seen to be good quality refurbishment

as it is unlikely that new sites for large scale schemes can be identified. However, given the

employment projections (GLA economics) there will be a need for increased space to

service business. Whilst the contraction of the public sector may counter-balance to some

extent, there is still a need to identify additional space.

Bromley is still developing its Local Development Framework and that will identify strategic

sites for office development, as in common with the rest of sub region the stock is often not

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of currently required quality. However within SCS it has identified that commercial

development is required and that it is important not to allow pressures for more housing take

employment sites.

Merton has identified a number of town centre sites and lack of office capacity is not an

identified risk here.

For the sub region generally, the issue in terms of capacity is more about the appropriate

type of stock rather than overall floor space and the potential to deliver new decentralised

sub regional economies. In terms of immediate demand, the greatest pressure is likely to

come from small start ups and creative/innovation concerns apart from a few easily

accessible locations such as Wimbledon, Richmond and Croydon.

8.6/ Retail

Across the sub region, there are several major retail areas, including the regional centres of

Richmond, Kingston, Croydon and Bromley and smaller town centres such as Wimbledon

and Clapham. Indeed the sub region plays a very large role in the provision of retailing for

Greater London with GLA/Experian (2009) estimating that 6 of the top 20 retail centres within

London fall within the sub-region as shown below:

Table 8.2

Retail Centre Rankings in South London

Centre Name Position Floorspace in

sq. m

Estimated

Turnover £m

Croydon 2nd 180,531 636

Kingston 3rd 169,531 646

Bromley 6th 108,222 444

Sutton 8th 95,782 325

Croydon (Purley Way) 9th 91,481 289

Wimbledon 20th 47,799 240

Total sub-regional major

centres

693,346 2,580

Total top 20 London centres 2,593,166 10,726

Sub-region as % of top 20 27% 24%


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Given that the West End accounts for some 33% of all London floor space and 39% of

turnover, the contribution of the sub-regions major centres is extremely significant.

However the recent lack of investment, the addition of Westfield and the planned White City

and Stratford centres within central London mean that competition will increase. It is

therefore important that floorspace is not lost and investment is undertaken to enable the

centres to retain competitiveness.

However, whilst there are well let and successful centres, most have been identified for

some inward investment or regeneration. Across the sub-region little significant additions to

floor space have taken place and where schemes have been identified the economic

downturn has led to a stalling of the process. However, with increasing confidence the

scope exists to improve and consolidate the major provision. For example Bromley is

planning an extension to the Glades Retail of up to 22,000 sq m which should enhance its

position within the London top 20 and help it defensively against for example Bluewater and

Kingston has long had plans for a town centre regeneration scheme. Capacity studies for

Kingston have identified sufficient capacity in the town centre to support 50,000 sq m gross

additional floorspace. Sutton has a series of smaller sites identified and it is estimated that

there is capacity within the pipeline to meet needs, although if planned investment in

Croydon is realised it is possible that Sutton might suffer.

Although Croydon is the largest retail centre in London outside the West End, it is in need of

investment as its turnover is less per sq metre than some other centres, notably Kingston,

reflective of the lower income per head. Driver Jonas (2009) reported that Croydon was in

need of a „significant‟ amount of new retail floorspace for the period up to 2021. Partly this is

due to the loss of Allders, which has significantly changed the retail mix in the town which

now has an under-representation of „aspirational‟ shopping. This is particularly in the

currently vulnerable area to the south of the town centre which is under-performing and

Drivers Jonas, suggest could provide mixed-use development possibilities. In terms of

realising the potential, the break in pedestrian flow caused by Wellesley Road is an issue, as

is the complex land ownership patterns and these will require address.

Richmond has a vibrant retail offer, but according to GVA Grimley‟s 2009 study, there will be

increased need for floorspace moving forward. Unlike Croydon, Richmond has aspirational

shopping but the perceived lack is more toward convenience and comparison shopping.

The study also highlighted risks such as Westfield, which could cut into the core market for

Richmond retail unless Richmond does take measures to ensure that the town centre offer

meets the needs of key high quality retailers.

Merton does not have one of the main regional centres, but as identified above Wimbledon

is an important retail centre. It also benefits not just from good communication in and out of

London/Surrey but the tram to the east has set up good communications with Croydon

meaning that the two retail centres are in potential competition n more than before. Retail

capacity studies for Merton indicate that there is a need for increases in both convenience

and comparison retail floorspace which are deliverable within identified sites.

In Wandsworth the adopted core strategy places town centres as the focus for the

development pipeline. Central Wandsworth and the Wandle delta provide opportunities

notably with the Ram Brewery site which with extensions to the Southside Shopping centre

could provide 40,000 sq m of commercial space. Although, with the recent permission on

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this development refused, it will have to be reassessed. A report on retail capacity in

Wandsworth (Lond2008/R11397) provides a detailed analysis of both current capacity and

future pipeline possibilities in the borough including convenience as well as comparison

shopping. This concluded that a good balance exists for convenience shopping and some

competitive pressures from both across and beyond the sub-region for the major centres.

In terms of capacity, however the opportunities sites, excluding Battersea Power Station

should suffice for likely future demand. Further this report, written before the full impact of

the economic downturn was evidenced concluded that if Battersea were to be developed

there could be negative implications for Clapham and Wandsworth and possibly across

centres in adjoining boroughs in the sub region most notably Wimbledon.

Whilst in summary, the capacity is estimated to be capable of growing to enable regional and

town centres to continue to thrive and support the residential catchment populations,

aspirational and wealthy, investment is needed to ensure that share is not lost to new central

London schemes.

Further, the same in not necessarily the case with local and district centres across the SLP

area and many of these, particularly in areas of high deprivation are struggling and will find it

difficult to remain competitive.

8.7/ Industrial/Manufacturing

Across the sub-region the availability of the „right type’ of industrial and stock capacity has

been identified as an issue (Industrial Capacity London Plan SPG, 2008). As with offices,

vacancy rates are low and, in most cases, below the London average. For this reason some

parts of the sub region have been designated as restricted in relation to transfer of industrial

land to other uses (GLA Industrial Capacity SPG). However a review of the identified

residential opportunities sites does reveal that when developer demand revives, some

industrial sites will be under pressure for change of use away from manufacturing. Given the

identification elsewhere in this report that the continued presence of a manufacturing base is

a key strength, it is clearly important to the maintenance of sites for industrial purposes is

maintained.

Areas where there may be particular pressure to lose industrial sites are Richmond who

have identified it as an issue and Wandsworth. Richmond does not have a large land use

allocation for industrial purposes. It is estimated that the total land used for

manufacturing/B8 is in slight decline and likely to so continue; however URS estimate that a

brought balance of supply and demand will continue until 2026 (URS, 2009).

One area of potential growth for several of the boroughs is in relation to waste management

schemes for which there is a need, as identified specifically in Sutton and Kingston, where

there is a general shortage of B8 sites and Wandsworth. In addition, the sub region has

been identified as appropriate for some small-scale innovation and research and

development facilities. It follows therefore that the need is likely to be for small sites that

have good accessibility. It is for these that there might be shortages moving forward.

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8.8/ Cultural / Leisure/Hotels

The sub-region has a rich heritage of open spaces and leisure facilities to service its

residents and many attractions have a visitor base which stretches far beyond the borders of

the area – for example Wimbledon, Fairfield Halls and Croydon Airport to name but a few.

Notwithstanding, there is an identified need to enhance not just heritage and open leisure

and sporting facilities but also D2 class uses such as cinemas, restaurants and a range of

cultural and arts venues.

Bromley and Croydon are among those who have identified sites for hotels whilst both

Bromley and Sutton have specified the need for cultural venues. In terms of site capacity no

specific capacity studies have been analysed but given the importance in employment terms

of leisure to the SLP this is an area where greater capacity moving forward may be required.

In terms of employment and economic development, the tourism industry could potentially

be a huge area of untapped demand. However, at the moment there is little to link the sub

region with other areas in the OMA or Central London, by the way of a strategy or actual

infrastructure.

8.9/ Summary

The sub region has many development constraints: it has a stock of buildings that often do

not meet changing needs and a large number of conservation areas and some metropolitan

green belt. Additionally some areas are in the Thames flood plain which could face

increased development restrictions moving forward as planning and insurance restrictions

tighten.

The immediate development capacity does indicate it can accommodate growth, although in

some areas residential capacity is insufficient unless either brownfield land in open space is

released or greater density can be gained through back lands or windfall sites. Office

capacity is less of an issue than the type of accommodation but industrial land is in short

supply and to preserve economic vitality it will be important that sites are not lost to

alternative uses.

Lastly, the area has a good number of significant or very significant opportunity sites which

have the potential to yield significant development capacity, but which could also re-shape

the landscape economically as well as physically. Whilst some of these, such as Battersea

have long and complex planning histories, there is real potential in optimising land around

transport nodes such as is proposed in Richmond, and where educational and health

facilities are being rationalised.

Capacity is very much an issue of perception and vision. At present, there are many

perceptions of what the sub region can and should be able to deliver. Considering the

increasing need for more localised forms of sustainable development, the potential

development capacity of the sub region should be viewed at the more optimistic end of the

spectrum if a more holistic approach towards development is to be taken. Therefore, rather

than just simply defining the constraints of the sub region, which lead to a self fulfilling

prophecy of limited/stagnant growth, it would be a far more considered opinion to consider

what needs to be done to achieve its potential within a more sustainable city-region.

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9/ SWOT Analysis of the Sub Region Strengths

High residents skills base across the sub-region with high proportions of residents holding senior and managerial positions (compared to South East and West/East/North London)

Strategic location in relation to London, South East and major airports

Strong and stable levels of entrepreneurship and enterprise within the sub-region

Good direct transport links into Central London – particularly rail and underground

High levels of economic activity amongst working age population

Strong regional retail locations with high retail turnover

Growing tourism and cultural offer with major sporting and leisure destinations located within the sub-region

Weaknesses

Low productivity (GVA per head) within the sub-region as compared to London and South East

Lack of retention of high skilled residents leading to very high levels of daily out-commuting

Over-reliance of economic structure on public admin and banking/financial services

Weaknesses in transport (public) links in some areas, particularly cross-boundary, leading to high levels of car use and problems with congestion on road networks

Pockets of serious deprivation within the sub-region

Significant disparity between residents and workplace based earnings

Lack of identified clustering and branding across the sub-region

Poor quality, ageing office accommodation which is inappropriate for demand – leading to high levels of vacancy

Opportunities

Nascent growth potential within small/micro businesses

Sectoral growth in the environmental/green industries and business opportunities to support „green‟ reputation of sub-region

Strong demand for smaller, serviced start-up workspaces

Clustering strength of Wandle Corridor as an industrial location

Potential to recapture high skilled residents who are unemployed due to the current economic downturn (or want to take advantage of QoL)

Major mixed use redevelopment and regeneration pipeline – Croydon, Wandsworth & Kingston

Extension to existing tram system represents a significant opportunity for commerce and retail within the sub-region

Capacity for housing growth

Strengthening of retail sector as localism and more sustainable transport patterns become norm

Threats

Issues with NEET in younger population

Identified skills gaps – particularly technical and vocational skills but also cross-cutting customer services and manual labour

Pressure for conversion of employment sites to residential use

Vulnerability to public sector cuts due to high reliance

Retail offer under stress

Continued loss of larger employers currently located within the sub-region

Issues with long term survival rates of enterprises within the sub-region

Increasing competition from London and South East, both in terms of business and retail

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10/ Summary?????

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