In our latest blog, Professor Jeremy Phillipson and  Roger Turner (CRE Associate and Rural Economics Consultant), discuss how the UK Industrial Strategy can embrace rural economies.

Would it be sensible to have an Industrial Strategy that overlooks an economic contribution equivalent to the 10 leading cities after London? The answer is clearly no, but this would be the risk if rural areas were not fully incorporated into the development and delivery of the Industrial Strategy. England’s rural areas host over half a million registered businesses and many more unregistered ones,  employ 3.5 million people, and in 2017 generated a GVA (gross value added) of at least £246 billion. They are integral to regional economies, make a substantial contribution to the vitality of their urban neighbours, and sustain communities of over 9.5 million people.

Thankfully, Industrial Strategy policy makers and rural stakeholders have been working hard to ensure that the strategy embraces our rural economies and places. Most recently this was boosted by a major workshop on the rural contribution to the Industrial Strategy, hosted by Rural Enterprise UK at Newcastle University in March.

As we move into the next pivotal stage of delivery, more than ever the contributions of rural areas to supporting growth and productivity need to be universally supported and embraced across Industrial Strategy processes and measures. Our team’s analysis of the Government’s own small business data is challenging assumptions that rural economies lack dynamism, perform less well, or are simply dependent on urban growth. Rural economies have untapped potential – for example around twice as many rural firms report having goods or services suitable for exporting than those which currently export. Rural areas are also at the forefront of major socio-economic trends such as an Ageing Society and Clean Growth – two of the Strategy’s Grand Challenges.

So how can rural representatives and other stakeholders ensure that Local Industrial Strategies are as relevant, accessible and visible to rural as to city and urban areas? How can the Strategy’s Grand Challenges be converted from grand and society–wide challenges to regional and local opportunities for rural areas?

These questions were tackled at the workshop by a unique gathering of expertise. Bringing together stakeholders from literally across the UK – from the Isles of Scilly in the south to Shetland in the north – the event gained insights from leaders in government-sector organisations, sub-national agencies and partnerships, business and community organisations, researchers from Newcastle University’s National Innovation Centres for Ageing and Data, and those of us long-engaged in researching small-medium enterprises (SMEs) and rural economies.

It was clear in our discussions that all of the Industrial Strategy’s features and foundations are also drivers of rural productivity or growth. Each raises long-standing and distinct rural challenges and prospects that require attention, which play out differently across the diversity of rural places, yet often remain underexplored or underutilised.  A short report from the workshop and further info is available here.

In summary, participants highlighted several prerequisites if rural contributions to the Industrial Strategy are to be fully realised:

• Meaningful sub-regional devolution of Industrial Strategy measures coupled with local co-developed solutions and capacity building to enable local ‘place’-defined delivery.
• Strengthened engagement of micro and small enterprises in developing and delivering Industrial Strategy measures and sector deals, with bolstered commitment to involving rural businesses.
• Improved networking and representation of rural firms to generate strategic thinking, leadership and collaboration.
• Enrolment of rural economies as leading lights or test beds for ideas and innovation linked to the Grand Challenges.
• Appropriate metrics, indicators and investment thresholds for defining rural outcomes and measuring success.
• Enhanced evidence, sensitive to local diversity in drivers, needs and opportunities, so that Local Enterprise Partnerships and other stakeholders are better equipped to embed rural contributions in local industrial strategies, sector and area growth deals.

One of our own highlights of the day was to hear a senior Defra official welcome this occasion as a rare event at which the main Department ‘talking rural’ was not the government’s own rural champion Defra, as is normally the case, but instead a host of leading contributions from other government departments, especially BEIS, MHCLG, DFT, DFE, Scotland Office etc[1]. Indeed, in his keynote presentation, Sam Lister, the Director of Industrial Strategy, made the case for respecting rural as an equal partner in the UK’s future economies. Both interventions say a lot about the positive progress made by both departments in considering the rural reach of the Strategy and the contributions of many stakeholders who have worked to enhance recognition of rural areas and their economies. Many participants welcomed this new recognition and shared space. Continuing this shared endeavour is more essential than ever, and at Newcastle University we are keen to help to extend this dialogue and convert ‘talking rural’ into visible and valued actions for the future.

[1] Department for Business, Energy and Industrial Strategy (BEIS), Ministry Housing, Communities and Local Government (MHCLG), Department for Transport (DFT) and Department for Education (DFE)