slough business base analysis

Slough

Business Focus Study

& Strategic ResponseSlough Borough Council

May 2015

Slough Strategic Response Paper

1

Summary

• This paper sets out possible areas for intervention for Slough Borough Counciland partners to respond to economic development issues locally. Theinterventions respond specifically to the needs which have been identified in theSlough Business Focus Study and include:

• Support economic growth

• Support key sectors and diversify into new ones

• Address skills issues

• Encourage and support enterprise and innovation

• Support development at key employment sites

• Address deficits in sites and premises

• Maximise opportunities resulting from transport

2

Support Economic Growth

• Achieving economic success and improving the competitiveness of Slough into thefuture are two key issues which need to be addressed. This will require a broad set ofinterventions cutting across a number of areas for example, skills, enterprise andinfrastructure (amongst others) and these are discussed further below. Given thesuccess of London, and Sloughs location in close proximity to boroughs in WestLondon, Slough could look to these areas for opportunities in terms of investment,supply-chains, business and sector opportunities. The two critical issues for Slough areas follows:

1. Improve Slough’s competitiveness: there are some signs that Slough is becoming lesscompetitive compared to other areas. According to the UK Competitiveness Index, Sloughhas lost its competitiveness compared to other areas since 2008, falling two places to the50th most competitive borough in the UK (out of 407). In order to address this issue,Slough needs to identify and communicate its USP to ensure that it can compete,promoting its business strengths and strengths in key sectors will be key. Ensuring thatSlough remains an attractive place to live and work will also be important and ensuring thatthe town centre remains attractive will be key.

2. Address employment decline: whilst the business base in Slough increased between 2008and 2013, the borough has witnessed a decline in employment over the same period. Adecline of -0.6% is higher than that experienced nationally (-0.2%) and is in contrast to thegrowth experienced by the West London Alliance area over the same period (+5.7%). Thesector recommendations below (amongst other recommendations) will be important inaddressing employment decline. 3

Support key sectors and diversify into

new ones• Slough should continue to support key sectors whilst looking to diversify into new

ones. Key sectors for Slough include the following:

1. ICT: this sector supports 16% (13,050) of all jobs in Slough. It is a fast growing sector withemployment increasing by 8% since 2008. Slough also has a significant specialism in thissector compared to the UK as a whole. As a high value added sector with potential forgrowth nationally, this sector should be supported. Slough has recently lost key employersin this sector to other locations and it is important that the area does not lose itscompetitiveness in relation to this area. We understand that there is significant demandfor data centres in Slough and it is important that this is supported together with highervalue opportunities. Other strengths which provide opportunities include software andICT consultancy. Ensuring that the skills are in place to support this sector (particularlySTEM/digital skills) will be important.

2. Logistics: this is also a key sector for Slough, supporting 8,260 employees (10% of thetotal) and employment is particularly concentrated compared to national levels. However,the sector has experienced a decline in employment of around 15% since 2008. This couldbe due to a range of factors such as increased levels of productivity and increasedcompetition from other locations. Given Slough’s accessibility, it is expected that growth inthis sector will continue to be strong. There is a strong presence around Heathrow airportand to some extent the growth of the sector will be dependent on the future of theairport. Ensuring strong accessibility and good transport links, together with provision oflarge sites to support growth will be key.

4


new ones• Slough should continue to support key sectors whilst looking to diversify into new ones.

Key sectors for Slough include the following:

3. Retail: there are 13,600 jobs within the wholesale and retail trade sector in Slough (17%)but employment in this sector is declining. Promoting and ensuring the growth of thissector will be essential to the growth of Slough town centre, a key priority for the borough.This will only happen if wider improvements to the town centre are made (as part of theHeart of Slough initiative). In relation to retail, consideration should be given to the roleand vision of the town centre and how it can differentiate itself from other nearby centreswhich have received investment (such as Bracknell Forest and Reading).

4. To a lesser extent food manufacturing is a key sector but more broadly it is advancedmanufacturing which is important. The food manufacturing sector is also fairly small insize, employing 2,420 people and employment in the sector is declining. Nevertheless,levels of concentration within this sector in Slough are higher than nationally. There may besome opportunities for growth in this sector but this should be seen in the context ofdeveloping advanced manufacturing techniques. With competition from lower costoverseas locations for manufacturing activities, Slough will need to ensure that it cancommunicate the right ‘offer’ to retain and attract firms in this sector.

5


new ones• At the same time, it is important that Slough does not become too focused on a narrow

range of sectors, which would leave the area vulnerable to structural changes in theeconomy. Slough should look to diversify into new opportunities:

• Pharmaceuticals and life sciences: is a key opportunity. This sector already supports 1,530jobs in Slough but employment is growing and the area has greater specialisms compared tonationally. Nationally, life sciences is seen to be a key growth area, with increased demandresulting from a growing and ageing population (with people living longer). As well aspharmaceuticals, there may be opportunities resulting from an ageing population,particularly around medical technologies and assisted living.

• Slough BC needs to recognise the challenges for all of these sectors (e.g. competitionfrom abroad) and as such the area should not be complacent. Further work will needto be carried out to understand specific opportunities for investment. Key prioritiesinclude:

• Carry out research into emerging sector opportunities such as life sciences (as well aspotentially the creative industries sector, though this is small in size). This should identify thespecific opportunities for growth and provide a clear action plan to achieve this.

• Overall, intervention will be required to support key and new sectors across the followingareas: supporting skills within these sectors; making sites available which are suitable for theneeds of the sector; provide targeted business support to encourage higher value / highgrowth opportunities. An inward investment strategy to attract new firms in key sectors willalso be important. 6

Address Skills Issues

• Addressing skills issues in Slough will be important in ensuring that local people canbenefit from the opportunities which exist across the borough and can help to enhancethe competitiveness of the area. There are a number of priorities or issues:

1. Address low levels of attainment and support progression: Slough is the 6th highestachieving local authority in the country and highest performing outside of London in termsof students achieving five or more GCSEs grade A*- C. At the same time, an above averageproportion of residents in Slough have no qualifications. Whilst there are increasing levelsof residents qualified to NVQ Level 4 + and above in Slough (i.e. degree level qualifications),performance is still below other comparator areas such as the Thames Valley Berkshire LEPand the West London Alliance. Issues of low levels of attainment need to be addressed andthere needs to be greater emphasis on progression. This will be key to ensuring that localpeople can access jobs locally and key responses include:

• Work with partners such as FE Colleges to provide information, advice and guidance(IAG) to local people to ensure that they are aware of the opportunities which existand how to access these. An emphasis should be placed on providing informationabout skills opportunities which relate to the types of jobs which are available locally.As well as progression to university, vocational routes will also be important.

7

Address Skills Issues

2. Address issues which cause a skills mismatch: our discussions have indicated that there is a severeskills mismatch in Slough, with the relatively low skilled workforce in Slough contrasting with thehighly skilled nature of the jobs which are available locally. The high levels of in-commuting intoSlough and the differentials between resident and workplace based earnings confirm that this is anissue. Tackling the supply side issues which exist, that is providers working with residents andemployers to ensure that specific skills needs are understood and responded to will be a priority.Demand side issues (i.e. ensuring a range of suitable jobs and a responsible approach to localrecruitment from employers) are also important. Key priorities include the following:

• Partners (Slough BC, FE providers) need to develop a better understanding of business skills needs. A businesssurvey or in-depth discussions with key firms across a range of key sectors would help to develop a betterunderstanding of the issues and requirements. This will inform the specific response required.

• Provide opportunities to develop Science, technology, engineering and maths (STEM) skills, which areimportant for supporting the IT and science based firms based in Slough. FE providers will need to ensure thatthere is appropriate provision in these areas to support these skills. This could include working with localemployers to provide apprenticeships.

• Improve basic skills amongst local residents. There are still reported to be particular issues locally in relation toa lack of basic skills such as English and maths. Again, FE providers need to ensure that there is appropriateprovision which local people can access.

• Slough Aspire allows local businesses to collaborate with public sector partners to ensure the local workforcehas the right level of skills to meet the needs of local companies. A Skills and Enterprise Centre has been createdat Slough Trading Estate and East Berkshire College delivers training on site which is aligned to business needs.This is a key project which should be supported and where required enhanced. This may include providing morespecific opportunities for companies to discuss vacancies and providing recruitment opportunities.

8

Encourage and Support Enterprise and

Innovation 1. Address low business survival rates in Slough: Slough’s business start-up rate is

above that for the Thames Valley Berkshire LEP and national levels, which is positive.However, the 5 year business survival rate in Slough is lower than all of the otherboroughs within the Thames Valley Berkshire LEP area. Our research suggests thatthe majority of businesses who stop trading, do so within the second and third yearsafter they are established. Support is therefore required to address the low survivalrates locally. Key responses include:

• Firstly, further research is required to understand what is driving levels of start-up in Slough,the characteristics of these firms, and their requirements (e.g. property and infrastructure). Itis also important to understand what the key barriers are which are resulting in the lowsurvival rates (e.g. finance, markets) to inform a response to address this.

• Secondly, it is important that support is provided to encourage business start-ups and topromote their growth. It is likely that Thames Valley Berkshire Business Growth Hub willprovide key opportunities for the area in this regard. In addition, the European Structural andInvestment Fund Strategy (ESIF) for Thames Valley Berkshire will also provide opportunitiesfor specific business support projects locally.

9

Encourage and Support Enterprise and

Innovation 2. Support Innovation and R&D: data available suggests that there are high levels of

innovation amongst businesses located in the South East. The nature of the firms inSlough, particularly around the Trading Estate also suggests that there are reasonablyhigh levels of innovation and R&D and it is important that this is supported andencouraged. Key responses are likely to include:

• Further research could be carried out to understand the true extent of innovation andinvestment in R&D amongst businesses located in Slough. This could be used as anopportunity to promote the area and to raise local profile.

• Some firms, particularly SME’s will require support with innovation and R&D and partnerscan assist through developing links with universities and research institutes. Due to the lackof a university in Slough, partners should look to forge greater links with key, relevantinstitutions outside of the borough. The Growth Hub and ESIF will both provide opportunitiesfor support in this area.

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Support development at key

employment sites• There are two key employment sites which should be the focus for attention. The key

issues and responses relating to these are summarised below.

1. Support Town Centre Regeneration: the town centre experienced the highest loss of jobs out ofall SOAs with 1,750 jobs lost between 2008 and 2013. Investment is therefore required toenhance the town centre’s competitiveness and to create employment. The town centrecurrently has a poor image and offer and there is limited choice in terms of retail, restaurantsand leisure uses and this acts as a barrier to supporting footfall and development in the town.

• The ‘Heart of Slough’ project is aimed at regenerating the town centre, with a number of keydevelopments such as the bus station improvements already complete or underway. Thecouncil is preparing a revised strategy (including a fresh vision) for the town centre and it isimportant that this is progressed. The council has a key role in driving this forward throughland assembly and working with the private sector to secure investment (potentially througha joint venture partnership). It is important that a mix of uses is promoted such as residentialand commercial uses.

• There should be a focus on improving the image of Slough, together with developmentswhich can improve the town centre gateways. In terms of commercial premises, ourdiscussions have indicated that there is a need for more Grade A office space and that thisshould be delivered in time to capitalise on key improvements such as Crossrail and WRaTH.There is a need to differentiate the town centre’s offer with that available at Slough TradingEstate, which suggests a stronger focus on space for medium sized firms together withsmaller businesses.

11

Support development at key

employment sites2. Slough Trading Estate: has been performing reasonably well and has seen a marginal

increase in employment (980 jobs since 2008), whilst Slough overall has seen a decline. Itis important that the role of the Trading Estate is maintained and enhanced, since this isa key asset for the Thames Valley Berkshire area as a whole, as well as Slough. The keyresponses to ensure the estates’ competitiveness includes the following:

• Recognise and assist with transport and parking issues: there are particular challenges aroundcongestion and car parking on the estate. In terms of addressing this issue, the focus should beon the promotion of a sustainable transport plan to encourage more people to travel by publictransport and to ensure better links between the estate and the town centre. The expansion ofHeathrow is also key to the estate’s continued success with around 60% of firms at SloughTrading Estate indicating that they are located there to be in close proximity to the airport.Continued support for its expansion is therefore important.

• Identify and maximise opportunities for development: a lack of development land is not justspecific to the expansion of Trading Estate but a wider issue across the whole of Slough tosupport employment growth. Slough Borough Council should work with the Trading Estate tomaximise opportunities for development on the site (through re-use of land, maximising densitywhere possible and identifying additional development opportunities). Failure to do this will leadto stagnating or declining employment levels and loss of opportunities to employment siteselsewhere.

• Tackling skills issues will also be important and the actions identified above will be critical inaddressing some of the issues which exist. Continued support for Slough Aspire will be important.

12

Address Deficits in Sites and Premises• Ensuring that there are sufficient sites and premises available for businesses will be

critical to supporting growth. Key issues and responses are likely to include:

1. Ensure that there are sufficient sites to support development: there is already a shortage ofland at some locations (such as Slough Trading Estate). Discussions have also indicated thatthere is some concern over the availability of sites to accommodate development in Sloughpost 2019 when there is likely to be no allocated greenfield sites available to accommodateadditional development. The council should begin to consider how it will address theseissues now and it is particularly important that employment land is not lost to other highervalue uses such as housing. Protecting key sites and marketing these will be key.

2. Use land more effectively: some land can also be used more effectively, for example in thetown centre, there are opportunities for higher value uses and redevelopment of sites. Thiswill be particularly important as the availability of land becomes more constrained.

3. Address housing issues: it is important that sufficient homes are developed to support agrowing population and to address affordability issues which exist across the South East. It isimportant that the right mix of housing is delivered to support growth, with a requirementfor new, good quality housing in Slough which will appeal to those in higher leveloccupations.

4. Ensure that there are sufficient commercial premises to meet demand: our discussions haveindicated that there is a shortage of Grade A offices in Slough. At the same time, weunderstand that some good office space has been available for some time. It is anticipatedthat demand for this type of space will increase with new transport improvements such asCrossrail and Slough needs to be positioned to capitalise from these developments. Key siteswhich will benefit include the town centre as well as Slough Trading Estate. 13

Maximise Transport Opportunities • A number of transport opportunities exist and it is important that Slough capitalises on

this. At the same time, there is a need to continue to address any transport issues whichexist.

1. Reinforce local connectivity: the area’s strong transport connectivity is one of the key factorsunderpinning its local economic performance, making the area attractive to businesses andenabling labour market improvements. Infrastructure investments such as Crossrail andWestern Rail Access to Heathrow (WRAtH) will help to reinforce Slough’s comparativeadvantage, boosting investment. Identifying additional opportunities for investment which canmaintain the areas competitiveness will be key.

2. Address congestion issues: it is recognised that this is a key potential constraint to the area’seconomic success and solutions to address this may include car sharing and home working.Continuation of good public transport links (e.g. shuttle buses) to and from key employmentareas such as Slough Trading Estate may also help to reduce congestion.

3. Ensure continued success of Heathrowthe expansion of Heathrow is important in ensuring theareas success with locations such as Slough Trading Estate attractive to businesses who wish tobe in close proximity to an international airport. Some sectors such as pharmaceuticals areparticularly reliant on this. Continued support for airport expansion will therefore be important.

4. Consider smarter ways to address issues which exist: ‘smart cities’ use digital technologies toenhance performance, reduce costs/consumption. There is support for the concept at bothEuropean and national level (BIS). Transport is one of the key smart sectors and this mayprovide opportunities to identify smarter ways to deal with issues such as congestion e.g.through smarter ways to travel. The council could explore European funding opportunities tosupport this. 14

Implementation

• A strong performing economy in Slough will require collaborative working with a rangeof partners. Slough BC should look to work with the following key groups in order tosupport growth locally:

1. Private Sector: engaging with local businesses will be important in ensuring that Slough BC has agood understanding of the nature of the issues which exist and ensuring that any support meetsthese needs. The council should seek to maximise opportunities to secure their input intodesigning and implementing economic development initiatives. As well as larger firms (e.g.those relating to key sectors), this should also include small and medium sized firms. Engagingwith developers and landlords across the town will be particularly important.

2. Key Stakeholders: engagement with a range of partners including colleges (such as EastBerkshire College), business support organisations (such as the local chamber of commerce) aswell as community and voluntary groups will also be important in terms of the delivery ofeconomic development initiatives.

3. Neighbouring Local Authorities: engagement with this group will be particularly important interms of addressing cross-boundary planning issues. This is essential in the light of potentialconstraints over land for housing and commercial development.

4. Thames Valley Berkshire LEP: is likely to continue to play an important role in providing strategicinput into economic development issues across the area and in providing funding opportunitiesto support key projects. It is important therefore that Slough BC continues to have a strongrepresentation on the LEP to ensure that this partnership reflects any issues and priorities whichare important to the council, particularly for large strategic issues such as sites and transport. 15

Funding

Slough BC should explore funding opportunities to support economic development priorities. Some of the key opportunities are likely to include:

• Local Growth Fund (LGF): Growth Deals provide funds to local enterprise partnerships (LEPs) for projects that benefit the local area and economy, focusing on job creation. LEPs themselves are responsible for identifying priority projects, working closely with partners such as local authorities. Potential projects include infrastructure projects (such as roads or enabling site development) as well as projects which support key sectors.

• Regional Growth Fund (RGF): supports projects which are raising economic growth and employment. The focus is on projects which create jobs and bids need to be led by the private sector. Nationally, there has been funding across a number of key sectors such as automotives and low carbon . A smaller number of projects have been supported in the South East. Nevertheless, Slough BC could work with the private sector to develop bids which support jobs growth.

• European Funding: there are various strands of European funding available. The LEPs ESIF document sets out priorities for projects focusing on ESF (skills investment) and ERDF (e.g. innovation). There is also European funding to support the Trans-European Transport Network (TEN-T) which could also be explored. URBACT can provide finding towards city planning and Interreg can provide opportunities for projects focusing on innovation.

• Other funding: other opportunities stem from New Homes Bonus (NHB) and retention of business rates. S106 or CIL can provide funding from developers to support the necessary investment in infrastructure such as roads.

16

Slough Sector Study

Section 1: Introduction

17

Section 1

Introduction, Contents and Approach

Study Purpose and Context

• Regeneris has been commissioned by Slough Borough Council to carry out an Economic Studywhich is seeking to provide an up to date picture of the nature of the business community in Slough(including numbers of firms, size and sectors) and the growth potential of the business base. Thisbuilds on the 2011 Local Economic Assessment carried out for East Berkshire (focusing on bothSlough BC and Windsor and Maidenhead Council). Our work will also provide some high levelrecommendations which will update the 2011 Strategic Response document.

• This report sets out the findings of our research and provides:

• Section 2 – A summary of the headline characteristics of the Slough economy, focusing onbusiness and enterprise performance in the Borough

• Section 3 – A headline review of the Borough’s sectoral composition

• Section 4 – A detailed consideration of the Boroughs key sectors, focusing on performance andopportunities in ICT, Pharma and Life Sciences, Logistics and Food Manufacturing.

18

Section 1

Introduction, Contents and Approach

Study Approach

• The research has been largely a desk-based, statistical exercise, and has drawn upon the following data-sources:

• The Inter-Departmental Business Register (IDBR) – we have used the 2014 IDBR dataset for Sloughthroughout. This is the most detailed local economic dataset available, providing intelligence on the Slougheconomy at the level of individual firms

• The Business Register and Employment Survey (BRES) – we have supported our analysis with informationfrom the BRES. This provides survey based information on employment at the local level and allowscomparison of Slough performance to wider geographies.

• Other ONS Datasets –we have also used a number of other relevant ONS datasets including ONS businessstart up and demography data. These datasets are referenced where relevant within the text.

• We have used comparator areas throughout the data analysis to gain a better understanding of Slough’s economyrelative to its neighbours, in addition to national data. Areas which were chosen for comparison are:

• Thames Valley Berkshire LEP (consisting of Bracknell Forest, Reading, Slough, West Berkshire, Windsor andMaidenhead and Wokingham)

• West London Alliance (consisting of Barnet, Brent, Ealing, Harrow, Hillingdon and Hounslow)

• In addition a number of consultations were held with a variety of key stakeholders in the Slough economy to gaina better understanding of current business needs in the Borough, potential opportunities for future businessgrowth and where there is room for improvement in Slough’s economy in the future.

19

Section 2: The Slough Economy

This section provides a headline level update on overall

economic performance across Slough

20


Economy Overview

2008 2013 Change

Business Base Businesses 4,685 5,480 795 (17.0%)

Micro Businesses (0-5 employees) 2,950 3,785 835 (28.3%)

Large Businesses (250+ employees) 45 45 0 (0.0%)

Mean Business Size 13.9 14.1 0.2 (1.9%)

Employment Base Total Employment 82,050 81,550 -500 (-0.6%)

% Full-time Employment 77.7% 78.2% 0.5%

Overall

Competitiveness

UK Competitiveness Index Rank* vs UK

Boroughs

48th

(out of 407)

50th

(out of 407)-2

*The UK Competitiveness Index is an integrated measure of competitiveness across the UK focusing on both the development

and sustainability of businesses and the economic welfare of individuals. Accessed from http://www.cforic.org/downloads.php

Size and Performance of the Slough Economy

• The performance of the Slough economy has been mixed in recent years, with the recent recession constrictingopportunities for growth.

• The business base has increased by 17.0% between 2008 and 2013, with strong growth in the number ofmicro businesses (+28.3%). This business growth is higher than experienced in the Thames Valley BerkshireLEP (+8.6%) and nationally (6.3%), although similar to business growth in the West London Alliance (17.5%)

• The borough is home to around 82,000 jobs, however this has declined slightly since 2008 (-0.6%). This islikely to be due to a lack of business confidence after the recession, with Slough experiencing a higheremployment decline than nationally (-0.2%). Across Thames Valley Berkshire LEP there was a larger declinein employment between 2008 and 2013 (-0.9%), although West London Alliance experienced employmentgrowth of 5.7%.

• When ranked across a range of socio-economic indicators, Slough is ranked as the 50th most competitive boroughin the UK (out of 407), however it is the lowest ranked borough in the Thames Valley Berkshire LEP and has lostcompetitiveness relative to other areas since 2008 (falling by two places).

Slough’s Business and Employment Base

21

http://www.cforic.org/downloads.php


Regional Output

Size and Performance of the Berkshire Economy

• The wider Berkshire region is a highly productive area and is the most productive NUTS 3 sub region in the UKoutside of London. This is calculated by the GVA produced per hour worked and indicates that businesses in theregion are highly efficient in producing goods and services.

Berkshire GVA per head, 2013

£23,755

£28,767

£28,863

£30,610

£30,945

£32,279

£36,242

£36,553

£38,029

£38,134

£38,918

£38,921

£20,000 £25,000 £30,000 £35,000 £40,000 £45,000 £50,000

United Kingdom

Oxfordshire

Bristol, City of

Surrey

Swindon

Glasgow City

Aberdeen City and Aberdeenshire

Belfast

Milton Keynes

Edinburgh, City of

Berkshire

Inner London - East

Inner London - West

GVA per head

£135,888

Source: ONS GVA by Sub-Region (2013)22


Regional OutputSize and Performance of the Berkshire Economy

• The growth rate of GVA in the Berkshire has been very volatile over the last 15 years, although it has onlydeclined once (in 2009).

• When analysing Berkshire’s GVA growth by sector over the last 15 years, seven sectors have seen their GVAdouble in that time period.

• Sectors which have performed well are: Real Estate (162%), Information and Communications (138%),Agriculture (117%) and Public Administration, Education and Health (111%).

• Sectors which have not performed well are: Production (of which manufacturing is one component) (19%)and Finance and Insurance (54%), which may in part be due to the financial crisis of 2007-08.

-2%

0%

2%

4%

6%

8%

10%

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

GVA Growth Rate (%)

Berkshire GVA Growth Rate (%)

117%

19%

-4%

106%

72%

138%

54%

162%

108% 111%

138%

93%

-20%

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

Berkshire GVA Growth Rate by Sector, 1997 – 2012 (%)

Source: ONS GVA by Sub-Region (2013) Source: ONS GVA by Sub-Region (2013)23


Recent Business Performance

Recent Business Performance: Regionally

• Slough has experienced a significant increase in its business base since 2004 (+43.3%*) and this is the highest levelof business growth across the Thames Valley Berkshire LEP (+19.6%).

• Slough has a relatively low business density, with 55.9 business per 1,000 population relative to the national level(56.8). Across Thames Valley Berkshire LEP, the business density is 72.1, with concentrations in Windsor andMaidenhead (101.1) and West Berkshire (89.2).This reflects the presence of several large firms in Slough.

% Change in Business Base, 2004 - 13 Business Density, 2013

Source: Annual Population Survey (2013) & UK Business Count (2013)Source: ONS Business Demography (2013)

24* = Data source (ONS Business Demography) is different to slide 5 (UK Business Count)


Recent Business Performance

Recent Business Performance: Locally

• When analysing Slough’s business performance in more detail,it can be seen that there has been strong business growth ininformation and communication (+47.5%), health (GPs,hospitals and care homes) (+45.9%) and transport and storage(+29.9%). The sector which has seen the largest decline is thepublic administration and defence (-42.9%) sector and this islargely the result of the current austerity measures in the publicsector.

• Areas which have seen exceptional business growth withinSlough are the West of Langley (+59.0%) and Wexham(+45.8%). The Slough Trading Estate has had the smallest rise inthe business base, increasing by only 0.9% since 2010.

% Change in Business Base, 2010 - 2014

% Change in Business Base by sector, 2010 - 2014

17%

8%

46%

16%

-43%

6%

31%

-4%

-5%

47%

-5%

30%

6%

6%

15%

11%

2%

-50% -30% -10% 10% 30% 50% 70%

TOTAL

Arts, Entertainment & Recreation

Health

Education

Public Admin & Defence

Business Admin & Support

Professional, Science & Tech

Property

Finance & Insurance

Info & Communication

Accommodation & Food

Transport & Storage

Retail

Wholesale

Motor trades

Construction

Manufacturing

Source: UK Business Count (2010 & 2014)Source: UK Business Count (2010 & 2014) 25


Business Characteristics

Slough Businesses by Employment Sizeband (IDBR)

0 to 4 5 to 9 10 to 49 50 to 250 250 plus Total

SloughNumber 3,785 675 740 235 45 5,480

% 69.1% 12.3% 13.5% 4.3% 0.8% -

Thames Valley Berkshire

%72.3% 12.0% 12.3% 2.8% 0.5% -

Business Characteristics

• Slough has a slightly larger average business size than the wider Thames Valley Berkshire area, with 69.1% of businesses employing 0-4 people and 5.1% employing 50+ people, compared to 72.3% and 3.3% respectively across Thames Valley Berkshire as a whole.

Slough Business Age Profile

Less than 2 years 2 - 3 years 4 - 9 years 10+ years

Slough 27.2% 16.7% 25.0% 31.1%

Thames Gateway Berkshire LEP 19.9% 14.4% 27.1% 38.6%

West London Alliance 22.6% 16.7% 27.3% 33.5%

England 17.4% 13.1% 26.6% 42.8%

• Slough’s businesses base is younger than comparator areas, with 27.2% of businesses less than two years old,compared to 19.9% in Thames Valley Berkshire LEP, 22.6% in the West London Alliance and 17.4% nationally.

• Additionally, Slough has relatively few well established businesses, with only 31.1% of businesses older than 10years, compared to 38.6% in Thames Valley Berkshire, 33.5% in the West London Alliance and 42.8% nationally.

• This suggests that either Slough has recently gained a high number of new businesses, adding to its existing base,or that business survival rates are poor as businesses cannot be competitive in the market.

Source: ONS Business Demography (2013)26


Enterprise Performance: Business Start Up Rates

Source: ONS Business Demography (2013)

Enterprise Performance

• Slough has a business start-up rate (10.8) comparable to the Thames Valley Berkshire rate (10.5) and higherthan the national level (9.1), although lower than the West London Alliance (13.9).

• Slough (41.1%) has the lowest 5 year business survival rate out of all the boroughs in the Thames ValleyBerkshire LEP (average = 45.2%). Slough does have a slightly better business survival rate than the West LondonAlliance area (39.7%)

0%

50%

100%

1 Year 2 Years 3 Years 4 Years 5 Years

Slough Thames Valley Berkshire LEP West London Alliance England

Business Survival Rates (%) – based on 2008

business births

Per 1,000 Residents 5 Year Survival RateStart-up Rate Death Rate Net Change

Slough 10.8 5.9 4.9 41.1%

Thames ValleyBerkshire LEP

10.5 6.8 3.6 45.2%

West London Alliance

13.9 8.8 5.1 39.7%

England 9.1 6.1 2.9 41.2%

Slough Enterprise Characteristics, 2013• The data suggests that the

majority of businesses who stoptrading, do so within the secondand third years after theirestablishment, with 17.9% ofbusinesses stopping in the secondyear and 16.2% in the third year.

Source: ONS Business Demography (2013)

27


Research and Development

Research and Development within the Slough Economy

• Data for Research and Development (R&D) is only available at the regional level. It reveals that in 2012, the SouthEast of England has the highest R&D spending per head in the UK (£714 per person).

• A large proportion of this comes from business, which has an R&D expenditure of £486 per person, andaccounts for 68% of all R&D spending.

• It is not easy to predict patterns of R&D spending in Slough, in part due to two reasons.

• The presence of many headquarters of large multi-national companies in Slough, could mean that businessR&D expenditure is above the South East level.

• However, the lack of any higher education establishments in Slough, will likely result in less highereducation R&D expenditure.

Government Higher Education Business Private Non-Profit Total

South East 98 128 486 2 714

London 41 229 161 18 449

England 38 116 318 10 481

R&D Expenditure, £s per person (2013)

Source: ONS (2013)

28


Recent Employment Performance

Employment Change: Wider Area

• Slough’s total employment has fallen by 0.6% between 2008 and 2013. This is a lower fall than experiencedacross Thames Valley Berkshire LEP (-0.9%), with high falls in Bracknell Forest (-9.2%) and Reading (-3.1%). TheWest London Alliance saw an increase in employment by 5.7%, experiencing high growth in Hounslow (+11.9%)and Brent (+11.0%). Nationally employment fell by 0.2%.

• Slough’s job density (the number of jobs per working aged person) is 0.9, similar to the Thames Valley Berkshirelevel (0.9) and higher than nationally (0.8). The West London Alliance has a considerably lower job density (0.6),although this is largely due to high levels of commuting to Central London. Hillingdon has a job density of 1.1, dueto the presence of Heathrow Airport, which again has high levels of in-commuting.

% Change in Employment, 2008 - 2013 Job Density, 2013

Source: BRES (2008 & 2013) Source: BRES (2013) & Annual Population Survey (2013)29


Recent Employment Performance

Employment Change: Locally

• Analysing employment change at the local level reveals that since2008, there are 500 fewer jobs in Slough (-0.6%), a higher rate ofdecline than nationally (-0.2%).

• Sectors experiencing the highest growth are the Informationand Communications sector (+1,530 jobs, +13.1%) and theTransport and Communications sector (+1,140 jobs, +15.4%)

• Sectors experiencing the highest decline in employmentsince 2008 are Manufacturing (-1,760 jobs, -19.1%), BusinessAdministration and Support (-1,690 jobs, -16.7%) andConstruction (-1,030, -27.9%).

• The highest increase in employment, occurred in the area betweenSlough Trading Estate and the town centre, with 1,010 additionaljobs created since 2008. Slough town centre has seen the highestloss, with 1,750 jobs lost. The Slough Trading Estate has seen anadditional 90 jobs since 2008.

Change in

Employment,

2008 - 2013

% Change in Employment by Sector, 2008 – 2013

-40% -20% 0% 20%

Arts, Entertain. & Rec

Health

Education

Public Admin & Defence

Admin & Support

Prof., Science Tech

Real Estate

Finance & Insurance

Info & Comms

Accomodation & Food

Transport & Storage

Wholesale & Retail

Construction

Manufacturing

Slough England

Source: BRES (2008 & 2013) Source: BRES (2008 & 2013) 30


Labour Market: Economic Activity

Economic Activity

• When analysing economic activity data, it reveals that in 2014, 77.2% of the working age population waseconomically active, a rate similar to the national level (77.7%) and West London Alliance (76.2%) although lowerthan the proportion in Thames Valley Berkshire LEP as a whole (81.4%).

• The proportion of economically active people in Slough has remained constant over the last ten years, witha slight decline experienced during the recent recession.

• The unemployment rate has fluctuated significantly over the last ten years, largely the result of the recession.Slough has largely remained at the national level for the whole period, although it has been consistently higherthan the wider Thames Valley Berkshire LEP area.

1%

2%

3%

4%

5%

6%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

SloughThames Valley Berkshire LEPWest London AllianceEngland

Unemployment Rate (%)

74%

76%

78%

80%

82%

84%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Slough Thames Valley Berkshire LEPWest London Alliance England

Economic Activity Rate (%)

Source: Annual Population Survey (2013) Source: Claimant Count (2005 – 2015)31


Labour Market: Salaries and Earnings

Recent Performance

• There is a notable difference between residence-based andworkplace-based salaries. The average weekly salary forSlough’s residents is £529 whereas the average salary forpeople working in Slough is £574. This suggests that asignificant number of high-earners who work in Slough liveoutside of the Borough, taking money away from the area.

• Slough’s residents have a very similar weekly salary to thenational level (£524) , although this is significantly below theTVB LEP level (£601) and the West London Alliance (£580)

• There are high levels of net in-commuting from Wokingham(1,250), Bracknell Forest (1,130) and Spelthorne (870).

• Slough has high net out-commuting to Hillingdon (-2,410),Westminster (-1,200) and Windsor and Maidenhead (520).

£480

£500

£520

£540

£560

£580

£600

£620

2009 2010 2011 2012 2013 2014

Slough Thames Valley Berkshire LEP

West London Alliance England

Residence-based Weekly Pay (£)

£529

£601

£580

£524

£574

£617

£573

£523

£470

£520

£570

£620

Slough Thames ValleyBerkshire LEP

West LondonAlliance

England

Residence Based Workplace Based

Residence-based and Workplace-based Weekly Salaries, 2014 (£)

£490

£510

£530

£550

£570

£590

£610

£630

2009 2010 2011 2012 2013 2014

Workplace-based Weekly Pay (£)

Source: Annual Survey of Hours and Earnings (2014)Source: Annual Survey of Hours and Earnings (2009 - 2014) 32

15%

20%

25%

30%

35%

40%

45%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

SloughThames Valley BerkshireEngland


Labour Market: Skills Base

Qualifications

• Slough’s residents have a distribution of qualifications comparable to the national level however Sloughunderperforms relative to the wider Thames Valley Berkshire LEP.

• 37% of Slough’s residents are educated to NVQ Level 4+, compared to 43% in TVB LEP and 46% in the WestLondon Alliance. Nationally 35% of people are educated to this level.

• 10% of Slough’s residents have no qualifications, compared to 9% nationally, 6% in TVB LEP and 7% in theWest London Alliance

• Slough has an increasing proportion of people educated at or above NVQ Level 4, and this has now exceeded theproportion of people nationally who hold this level of qualification. The benefits of a highly educated workforce,are twofold. One, it provides local firms with a pool of well educated workers, making them more productive.Secondly, an individual who has a qualification (of any kind) is far more likely to be employed (72.9%) than anindividual with no qualifications (50.9%).

0%

10%

20%

30%

40%

50%

Noqualifications

NVQ Level 1 NVQ Level 2 NVQ Level 3 NVQ Level 4 Otherqualifications

Thames Valley Berkshire LEP West London Alliance England Slough

Highest Level of Qualification

Source: Annual Population Survey (2014)33

% Qualified at or above NVQ Level 4

Source: Annual Population Survey (2004 - 2014)


Labour Market: Skills BaseSchool Leavers’ Qualifications & Higher Education Participation

• Slough has an exceptionally high proportion of pupils achieving five or more GCSEs grade A*-C grade (includingEnglish and maths), with 71.4% of pupils achieving this grade in 2012/13. This places Slough as the 6th highestachieving Local Authority in the country, and the highest performing outside of London*.

• Having these high levels of qualifications offers school leavers more options in their future, allowing them toattend college, university and apply for higher-level jobs.

• The presence of four Grammar schools in Slough, which attract a number of students from outside the Slougharea, may increase the level of Slough’s attainment rates, and therefore these figures may not reflect thequalifications held by residents.

• Data on higher education participation rates, suggests that Slough performs well below expectations, withrelatively few people attending university based on Slough’s GCSE attainment and ethnic profile. 9 out of 14 wardsin Slough have higher education participation rates below expectations.

45%

50%

55%

60%

65%

70%

75%

2006 2007 2008 2009 2010 2011 2012 2013

Slough

South East

Outer London

England

% of Pupils achieving 5+ A*-C Grade including

English and mathematics GCSEs

* = Excluding the Isles of Scilly

** = Calculated using GCSE attainment and ethnic profile

Actual Higher Education Participation vs.

Expected** Higher Education Participation, 2013

Source: Department for Education (2006-13)

Source: Higher Education Funding Council for England (2013) 34


Economy Overview

Size and Performance of the Slough Economy

• The Index of Multiple Deprivation (IMD) is an index produced by the government, which is calculated byexamining the following areas:

• Income

• Employment

• Health Deprivation and Disability

• Education, Skills and Training

• Barriers to Housing and Services

• Crime

• Living Environment

Index of Multiple Deprivation (IMD) 2013

• Slough is more deprived than the restof Thames Valley Berkshire LEP. OneLSOA in Slough is among the top 10%most deprived in the country.

• No LSOA in Slough is in the top 20%least deprived in the country.

Source: DCLG (2013) 35


Commercial Property Market

Commercial Property Market

• The current office supply in Slough consists of a relatively high amount of Grade B and C office space,with far less Grade A office space available. By comparison, Reading has a large amount of Grade A officespace.

• Across the wider Thames Valley area, Grade A office supply accounts for 40% of the total, compared to27% in 2013. New occupiers are increasingly faced with a choice between poor end Grade B or newGrade A space. Occupiers are increasingly willing to pay higher rental values for Grade A office space,even if they have to wait for new facilities to be built.

• The worrying lack of available Grade A office space may deter potential occupiers from locating toSlough, favouring nearby towns such as Reading with a high supply of Grade A office space.

• Lambert Smith Hampton make four keypredictions for the office market within theThames Valley area for 2015:

1) Take up will increase;

2) Rental values will move upward;

3) There will be further polarisation of supplytowards Grade A;

4) Investment yields will harden.

Source: Lambert Smith Hampton (2015)36

Section 3: Sectoral Composition

This section provides an high level review of the sectoral

composition of the Slough economy to ascertain existing sector

strengths and any emerging opportunities

37


Broad Employment Sectors

Manufact-

uring

Construction Wholesale & Retail

Transport

& Storage

Accom. &

Food

Info &

Comms

Finance &

Insurance

Property Prof,

Science

Business

Admin

Public

Admin

Education Health Arts

Employment 7,470 2,660 13,570 8,520 2,950 13,200 1,080 400 6,430 8,440 1,740 5,640 6,160 2,160

Slough LQ* 1.1 0.7 1.0 2.3 0.5 3.9 0.4 0.3 0.9 1.2 0.5 0.7 0.6 0.6

An LQ (Location quotient) provide an indication of relative specialisation in a specific sector locally, in this case relative to the England average

Degree of Specialisation of Employment by Sector

Slough’s Employment Sector Breakdown

• By analysing the composition of employment in Slough, the key sectors which provide the largest amount ofemployment can be identified. By comparing this to national figures, it can be seen whether employment is moreor less concentrated in Slough’s sectors compared to nationally and this helps identify the key sectors in theeconomy. This is known as the Location Quotient (LQ).

• Key strengths of the Slough economy are: Information and Communication (LQ = 3.9), Transport and Storage(LQ = 2.3), Business Administration and Support (LQ = 1.2) and Manufacturing (LQ = 1.1).

0%

3%

6%

9%

12%

15%

18%

0%

3%

6%

9%

12%

15%

18% Thames Valley Berkshire LEP West London Alliance England Slough

Source: BRES (2013)38


Broad Business Sectors

Manufac’ Construction Wholesale & Retail

Transport

& Storage

Accom &

Food

Info &

Comms

Finance &

Insurance

Real

Estate

Prof,

Science

Business

Admin

Public

Admin

Education Health Arts

Businesses 250 420 1,100 500 260 870 110 130 680 440 <50 110 270 285

Slough LQ

vs. England0.9 0.7 1.1 2.8 0.8 2.1 0.8 0.6 0.8 1.1 0.4 0.8 0.9 0.8

Location Quotient of Businesses by Sector

Slough’s Business Breakdown

• Analysing the business composition in Slough, reveals that Slough has a significantly higher business concentrationthan the national level in the Transport and Storage (LQ = 2.8), and Information and Communication (LQ = 2.1)sectors.

• This follows a similar trend to the employment distribution

• Other sectors which have a higher concentration of businesses in Slough than nationally are wholesale and retail(LQ = 1.1) and business administration and support (LQ = 1.1).

0%

5%

10%

15%

20%Slough England

Source: UK Business Count (2014)

39


Sector Drill Down: Largest Employment Sub-Sectors

Sub-sector (2 Digit SIC Code) Examples Employment % of Total

Computer programming, consultancy and

related activitiesComputer programmers, IT Consultants

7,810 10%

Retail trade Supermarkets, shopping centres 6,670 8%

Education Teachers (nursery/primary/secondary) 5,640 7%

Employment activities Recruitment Agencies 4,900 6%

Telecommunications Mobile Phone operators 4,870 6%

Human Health Activities GPs, Nurses, hospital staff 4,740 6%

Wholesale trade Resale of new or used goods to retailers 4,700 6%

Activities of head offices; management

consultancy activitiesJobs within the HQs of companies

3,630 4%

Postal and courier activities Postmen, delivery drivers 3,440 4%

Warehousing and support activities for

transportationPackaging, sorters

3,370 4%

Top 10 Combined 49,770 61%

Slough’s Largest Employment Sub-Sectors

• 2 Digit Standard Industrial Classification (SIC) codes allow for more detailed analysis of the parts of Slough’seconomy which are performing more strongly or less strongly.

• The top 10 largest sub-sectors provide 61% of the Borough’s employment:

• Computer programming, consulting and related activities is the largest provider of employment,accounting for 10% of the employment base. A related sub-sector, telecommunications, also provides anadditional 6% of jobs (4,870).

• Retail trade and wholesale trade also account for over 11,370 jobs, accounting for 14% of the total.



Sector Drill Down: Most Specialised Sub-Sectors

Sub-sector (5 Digit SIC codes)LQ (relative to

England)Employment

Large Employers in

Slough

Wireless Telecommunication Activities 35.5 1,650 Telefonica (O2)

Manufacture of cocoa and chocolate confectionery 33.4 1,030 Mars

Manufacture of basic pharmaceutical products 26.1 650 Lonza

Freight air transport 25.7 210 Davies Turner

Manufacture of paints, varnishes and similar coatings,

mastics and sealants

20.5 810AkzoNobel

Repair of communication equipment 13.4 140 Panasonic Avionics

Manufacture of non-electronic instruments and

appliances for measuring, testing and navigation,

except industrial process control equipment

12.1 190

Mobrey

Licensed Carriers 11.3 120 Consolidated Logistics

Wholesale of mining, construction and civil engineering

machinery

11.3 230Unatrac, Finning

Research and experimental development on social

sciences and humanities

11.0 160 National Foundation for

Educational Research

Top 10 Combined - 5,190 (6.4% of total)

Slough’s Most Specialised Employment Sub-Sectors

• Analysis of Slough’s employment and the 5-digit SIC code level, reveals the sub-sectors in Slough with the highest degree of specialisation relative to the UK.

• Wireless telecommunication activities (LQ – 35.5) and manufacture of cocoa and chocolate confectionary (LQ = 33.4) are the two sub-sectors with the highest concentration of employment relative to the national level.



Sector Drill Down: Top Growth Sub-Sectors

Sub-sector (2 Digit SIC codes) Examples 2008 2013 Increase (%)

Telecommunications Mobile Phone operators 3,720 4,870 1,150 (30%)

Warehousing and support activities for transportation Packaging, sorters 2,450 3,370 920 (37%)

Activities of head offices; management consultancy

activities

Jobs within the HQs of companies 2,740 3,630 890 (32%)

Education Teachers (nursery/primary/secondary) 4,800 5,640 840 (17%)

Retail trade Supermarkets, shopping centres 6,060 6,670 610 (10%)

Repair of computers and personal and household goods Computer repairs 40 600 540 (1,467%)

Computer programming, consultancy and related

activities

Computer programmers, IT

Consultants

7,350 7,810 460 (6%)

Sewerage Waste water management 20 470 450 (1,919%)

Postal and courier activities Postmen, delivery drivers 3,120 3,440 320 (10%)

Public administration and defence; compulsory social

security

Local authority, Police, Immigration 1,480 1,740 260 (18%)

Slough’s Top Growth Employment Sub-Sectors

• Some of Slough’s sub-sectors have seen very high growth rates in the last 5 years. In particulartelecommunications (+1,150 jobs) and warehousing and support services for transportation (+920 jobs) haveseen the highest real increases.

• The sewerage sub-sector (+1,919%) and the repair of computers and personal and household goods(+1,467%) have seen the highest proportional increase.

Source: BRES (2013)

42


Sector Drill Down: Declining Sub-Sectors

Sub-sector (2 Digit SIC codes) Examples 2008 2013 Decline (%)

Wholesale trade Resale of new or used goods to retailers 5,990 4,700 -1,290 (-22%)

Specialised construction activities Electricians, Painters, Demolition, Plumbers 2,700 1,980 -720 (-27%)

Services to buildings and landscape activities Cleaners, Gardeners 2,150 1,600 -550 (-26%)

Repair and installation of machinery and

equipment

General of Routine Maintenance of Machinery 580 40 -540 (-93%)

Manufacture of computer, electronic and

optical products

Manufactures of computers, communication

equipment, watches and clocks

720 280 -440 (-61%)

Office administrative, office support and other

business support activities

Office administrator, Printers, Call Centres 980 590 -390 (-40%)

Advertising and market research Advertisers and marketers. 540 150 -390 (-73%)

Manufacture of machinery and equipment

n.e.c.

Manufacture of hand-held devices, special

equipment for transportation.

900 530 -370 (-41%)

Manufacture of food products Food Manufacturing 2,690 2,350 -340 (-13%)

Travel agency, tour operator and other

reservation service and related activities

Travel agents 370 60 -310 (-85%)

Slough’s Declining Sub-Sectors

• Several sectors in Slough have experienced a decline in employment since 2008. Wholesale trade has seen thelargest real fall in employment (-1,290 jobs), and is one of the sectors which employs the largest number ofpeople in Slough. In addition, the specialised construction sub-sector has seen employment decline by 720 jobs(-27%)

• The repair and installation of machinery and equipment sub-sector has experienced the highestproportional decline in employment (-93%) followed by the travel agency, tour operator sub-sector (-85%).

Source: BRES (2013) 43

Section 4: Key Sectors Analysis

This section focuses on a number of Slough’s key sectors and

provides a detailed assessment of current performance in 4

specific sectors: ICT, Pharma and Life Sciences, Logistics and

Food Manufacturing

44

Section 4: Key Sectors

Key Sectors Analysis

What are Slough’s Key Sectors?

• In identifying the sectors which are likely to be most important in driving future economic growth in Slough, itis important to take into account both existing strengths and future growth prospects (both local and at widergeographic levels):

• Existing Slough sector strengths: based on analysis of data detailed previously and review of councilpolicy documents, existing sector strengths for Slough include information and communications,transport and storage, education and health;

• Key Thames Valley Berkshire LEP Sectors – based on opportunity sectors targeted by the Thames ValleyLEP in their Strategic Economic Plan. This includes ICT, Pharma and Life Sciences, Business and FinancialServices, Energy and Defence and Logistics.

• This section examines Slough’s current performance in each of the above sectors. Specific focus is placed onopportunities to develop local strengths in:

• 1. ICT;

• 2. Pharma and Life Sciences;

• 3. Logistics;

• 4. Food Manufacturing activities.

45


Focus on… 1. ICT

Slough ICT Sector Overview

2010 2014 Change

Business Base Businesses (% of total) 545 (11.6%) 825 (15.1%) +280 (+51.4%)

Micro Businesses (0-10 employees) 465 755 +290 (+62.4%)

2008 2013 Change

Employment

Base

Total Employment (% of total) 12,110 (13.5%) 13,050 (16.0%) 950 (7.8%)

% Full-time Employment 95.3% 94.6% -0.7% points

Location Quotient 4.0 5.0 +1.0

ICT Sector in Slough: Overview

• The ICT sector currently has an extremely large presence in Slough, with both large multinational firms and smallenterprises located in the Borough.

• This sector accounts for 16.0% of all employment and 15.1% of all businesses.

• Slough has the second highest concentration of employment in the Thames Valley Berkshire LEP (behindWokingham). The concentration of employment in this sector is 5 times higher than the national level (3.2%).

• There has been a reduction in the number of people employed on a full time basis (declining by 0.7% points since2008), although this may indicate increasing levels of self employment in this sector.

17%16%

13% 12% 11% 11%10%

4% 3%

0%

3%

6%

9%

12%

15%

18%

Wokingham Slough Thames ValleyBerkshire LEP

Reading Bracknell Forest West Berkshire Windsor andMaidenhead

West LondonAlliance

England

% o

f To

tal E

mp

loym

ent



Focus on… 1. ICT

ICT in Slough: Geography

• Activity in the ICT sector is concentrated in two wards – Upton has 35% of Slough’s ICT employment (due to thepresence of several large ICT firms around the town centre ) and Farnham has 24% of employment in ICT (withthis ward containing Slough Trading Estate).

• There is a fairly even distribution of businesses across the borough, although there are notable concentrationsaround Slough Trading Estate and the town centre.

• Large firms located in Slough include Telefoncia O2 (1,600 employees), Blackberry (550 employees) andTravelport (500 employees).

ICT Sector – Employment Density ICT Sector – Location of Businesses

Source: BRES (2013) Source: IDBR (2014) 47


Focus on… 1. ICT

48

2.1%1.9% 1.8%

1.7% 1.6%

0.6% 0.5%

0.2%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

West Berkshire Slough Wokingham Windsor andMaidenhead


West LondonAlliance

England Reading

% o

f To

tal E

mp

loym

ent


Focus on… 2. Pharma and Life Sciences

Pharma and Life Sciences in Slough: Overview

• The pharmaceutical sector currently has a relatively small presence in Slough, contributing 1.9% of employment(1,530 jobs). However employment in this sector is over three times more concentrated than nationally,suggesting that the sector is strongly performing despite its small size.

• Pharma and life sciences’ companies account for only 0.4% of the district’s business base, highlighting the largerthan average employment size of businesses in this sector locally.

• Overall the number of business in this sector has increased by 33.3% between 2010 and 2014 (albeit from a verylow base)

Slough Pharma and Life Sciences Sector

2010 2014 Change


Micro Businesses (0-5 employees) 5 10 +5 (+100%)

2008 2013 Change

Employment

Base

Total Employment (% of total) 1,130 (1.3%) 1,530 (1.9%) 400 (35.9%)

% Full-time Employment 80.6% 95.5% +14.9% points


Source: BRES (2013) 49



Pharma and Life Sciences in Slough: Geography

• Pharmaceutical activity is largely concentrated around Slough Trading Estate, especially in Farnham ward (61.4%of employment) and Cippenham Meadows (27.9%).

• The largest firms in the pharmaceutical sector are all located in Slough Trading Estate and these are Lonza (610employees), Reckitt Benckiser Healthcare (420), RB (400), Karl Storz Endoscopy (150) and UCB (120).

Pharma and Life Sciences Sector – Employment Density Pharma and Life Sciences Sector – Location of Businesses

Source: BRES (2013) Source: IDBR (2014)50



51


Focus on… 3. Logistics

Logistics in Slough: Overview

• Slough has a significant strength in the logistics sector, in part due to its strategic location between the M4, M25 andHeathrow Airport. The sector employs 8,260 people and accounts for 10.1% of all employment in the Borough. Thisis far higher than any other Borough in the Thames Valley Berkshire LEP (3.2%) and nationally (3.2%).

• Worryingly, despite a significant increase in business numbers (+33.3%) since 2010, employment in this sector hasdeclined by 14.9% (-1,440 jobs) since 2008, suggesting that firms in Slough are losing their competitiveness.

Slough Logistics Sector

2010 2014 Change



2008 2013 Change

Employment

Base

Total Employment (% of total) 9,700 (10.8%) 8,260 (10.1%) -1,440 (-14.9%)


Location Quotient 3.3 3.2 -0.1

10%

6%

3% 3%3% 2%

2% 2%

1%

0%

2%

4%

6%

8%

10%

Slough West LondonAlliance


England Bracknell Forest West Berkshire Reading Windsor andMaidenhead

Wokingham

% o

f To

tal E

mp

loym

ent

Source: BRES (2013)

52



Logistics in Slough: Geography

• The logistics sector is mostly concentrated around Heathrow Airport and Junction 5 of the M4.

• Colnbrook with Poyle ward has the highest concentration of Slough’s employment in this sector,accounting for 51% of jobs in this sector. The adjoining ward of Foxborough accounts for a further 28% oflogistics employment

• Large firms located in Slough are Royal Mail (2,000 employees), DHL (600 employees), Saints Transport (300employees and UPS (200 employees). All of these are located in the Colnbrook with Poyle ward.

Logistics Sector – Employment Density Logistics Sector – Location of Businesses

Source: BRES (2013) Source: IDBR (2014) 53



54


Focus on… 4. Food Manufacturing

Food Manufacturing in Slough: Overview

• The Food Manufacturing sector is relatively small in Slough, accounting for 3.0% of total employment (2,420 jobs).However it is more concentrated than nationally (LQ = 2.3) and has the highest concentration of employmentrelative to other Boroughs in the Thames Valley Berkshire LEP.

• The large average size of companies based in this sector is highlighted by the relatively low number of businesses,which nonetheless still represents a notable increase (+33.3%) since 2010.

Slough Food Manufacturing Sector

2010 2014 Change


Micro Businesses (0-5 employees) 5 10 +5 (+100%)

2008 2013 Change

Employment

Base

Total Employment (% of total) 2,490 (2.8%) 2,420 (3.0%) -70 (-2.8%)



3.0%

2.1%

1.3%

0.9%0.7%

0.2%0.1% 0.1% 0.0%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

Slough West LondonAlliance

England West Berkshire Thames ValleyBerkshire LEP

Windsor andMaidenhead

Wokingham Bracknell Forest Reading

% o

f To

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loym

ent




Food Manufacturing in Slough: Geography

• Employment within the Food Manufacturing sector is found almost entirely within two wards. Colnbrook withPoyle wards accounts for 50% of Slough’s employment in the logistics sector and Haymill ward accounts for 43%of employment.

• Large firms located within these wards are: Mars (1,000 employees; Haymill Ward), Food Partners (900employees; Colnbrook with Poyle ward) and Montana Bakery (290 employees; Colnbrook with Poyle ward).

Food Manufacturing Sector – Employment Density Food Manufacturing Sector – Location of Businesses

Source: BRES (2013) Source: IDBR (2014)56



57


Other Key Sectors (1): Education and Health

The Education Sector in Slough

• The Education sector has seen a decline in employment between 2008 and 2013 of -6.9% compared to a -0.4% fall nationally. The high increase in the % of people in full time employment, suggests a large number of part time workers have lost their jobs.

The Health Sector in Slough

• Employment in the health sector in Slough has increase by 0.5% since 2008, lower than the national rise of 5.9%.

Overview of Health Sector

2010 2014 Change



2008 2013 Change

Employment

Base

Total Employment (% of total) 4,720 (5.3%) 4,740 (5.8%) +20 (+0.5%)


Location Quotient 0.8 0.8 0

Overview of Education Sector

2010 2014 Change



2008 2013 Change

Employment

Base




Source: BRES (2013)

Source: BRES (2013)

58


Other Key Sectors (2): Wholesale & Retail and

Finance & Insurance

Overview of Wholesale & Retail Sector

2010 2014 Change

Business Base Businesses (% of total) 1,020 (21.8%) 1,100 (20.1%) +80 (+7.8%)


2008 2013 Change

Employment

Base



Location Quotient 1.0 1.0 0

Wholesale & Retail in Slough

• The wholesale & retail sector has seen a decline in employment of -5.7% since 2008.

Source: BRES (2013)

Financial Services in Slough

• Although the Financial Services sector only accounts for a small proportion of Slough’s total employment (1.3%), it is one of the fastest growing (+22.5% employment growth since 2008).

• Slough’s proximity and good connections to London means that it is a sector which offers high growth potential in the future, as Slough will be 45 minutes from Canary Wharf when Crossrail is complete.

Overview of Financial Services

2010 2014 Change

Business Base Businesses (% of total) 110 (2.3%) 100 (1.8%) -10 (-9.1%)

Micro Businesses (0-10 employees) 85 80 -5 (-5.9%)

2008 2013 Change

Employment

Base

Total Employment (% of total) 880 (1.0%) 1,080 (1.3%) 200 (22.5%)


Location Quotient 0.3 0.4 +0.1 59

Section 5: Summary

and Next Steps

This section summarises key findings from

this initial analysis and identifies areas for

further research

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Section 5: Summary and Next Steps

Summary of Findings

The Slough Economy

• Slough has a relatively strong economy, with significant strengths in the information and communications, andtransport and storage sectors. Despite the strong economy, its performance has only been average in recentyears, with business growth of 43.3% since 2004 and an employment decline of 0.6% since 2008.

• Slough has relatively high levels of deprivation, although it is the highest performing Local Authority outside ofLondon with regard to ensuring pupils receive five GCSEs Grade A*-C including English and Maths.

Doing Business in Slough

• Slough is home to the headquarters of a number of large, multinational companies across a broad array ofsectors. The Slough economy benefits from its close proximity to Heathrow Airport, the Great Western Railwayand the motorway network (M25 and M4).

• Enterprise performance in Slough is good, with business start-up rates (10.8 per 1,000 residents), higher thanthe national level (9.1), and there is a net addition of 4.9 business per 1,000 residents per year, compared to 2.9nationally

Slough’s Key Sectors and Future Opportunities

• Slough’s sectoral strengths are across a mixture of high and low value added sectors, which is beneficial, as itprovides employment opportunities for the diverse mix of residents in Slough.

• The Borough performs very strongly against some of the target sectors for the Thames Valley Berkshire LEP, withsignificant strengths in ICT, Pharmaceuticals and Life Sciences and the Logistics sectors.

• Slough is set to benefit further from better rail connections to London (Crossrail) and Heathrow (WRAtH), whichwill encourage more businesses to set up in Slough, building upon its already strong business environment.These improvements may also encourage more migration to Slough, which could result in added expenditurelocally and improve the perceived negative image of the town centre. The current regeneration programme inthe town centre (Heart of Slough) will further improve this. 61


Summary of Findings

Areas for Improvement

• A large concern for many businesses in Slough, is the mismatch of jobs to workers, with firms having to attractworkers from outside of the Borough as there are no suitable employees within Slough. This is reflected in thedisparity between workplace-based and residence-based salaries in Slough, revealing that there is a goodbusiness base in Slough, but Slough’s residents are unable to gain the full benefit from this.

• To improve its labour force, Slough should look to improve two key skills areas:

• Ensuring that more residents have basic English and Maths skills;

• Encourage more people to enrol in Science, Technology, Engineering and Mathematics courses at Furtherand Higher Education Institutions.

• More Grade A office space should be provided in the Town Centre and in Slough Trading Estate to make the areamore attractive to firms and to take advantage of the improved rail access that will be offered to London andHeathrow. Efforts should be made to safeguard high quality office space from redevelopment into residential orentertainment uses, as this may limit the number of businesses who are able to relocate to Slough.

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Suggested Further Research (1)

Further Research (1): More Detailed Interrogation of Relevant Datasets

• The objective of this research was to undertake initial analysis of the IDBR and BRES datasets for Slough; however,there is scope for analysis of wider datasets to provide more detailed intelligence on the distribution of localbusinesses and employment and any clustering of specific types of activity:

• Recognising the limitations of IDBR and BRES data – while IDBR and BRES provide a good basis for analysis,it is important to note that these datasets are not perfect and do not necessarily include the full localbusiness base: often many of the smallest businesses are excluded from official datasets as they fall belowofficial accounting thresholds.

• Expanding analysis to include open data sources – reflecting the above, in establishing as full anunderstanding of the local context as possible, it is important to take advantage of increasing range ofbusiness intelligence tools available. This includes:

• Private business databases – business databases such as Duedil and MINT provide an invaluable sourceof local business intelligence, drawing on data from both the web and Companies House, to provide amore inclusive snapshot of local areas than might be the case with ONS data. While it is possible thatmany of these additional businesses are not actively trading, it serves to highlight the value ofexploring multiple sources

• Other locally held databases – other datasets held by local business representative organisations canalso be helpful in providing real time and bespoke information at the local level

• Council information – council databases such as the business rates register can provide a further levelof detail by which to map the characteristics and activity of the local business base

• Triangulating the results of these datasets will help to map the local small business base in more detail thanis typically possible, identifying in particular, the companies which may not always be captured in publicdatasets.

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Suggested Further Research (2)

Further Research (2): Detailed Examination of Business Characteristics

• Quantitative data can only ever provide part of the picture; to fully understand local business characteristics andperformance it is helpful to engage with the businesses themselves. To be most effective, engagement withbusinesses should take a number of forms:

• Business survey – large scale business surveys allow a large number of businesses to be reached andcanvassed, although necessarily the depth of information provided by a business survey will be limited to astructured set of questions and discussion areas.

• In-depth engagement with key businesses – less structured, more detailed engagement (one to onediscussions) can help to establish a more detailed understanding of the key issues and challenges beingfaced by businesses. This approach would be appropriate to target businesses in specific priority sectors orwithin certain clusters of activity.

• Workshops / focus groups – certain groups, such as homeworkers, are difficult to access on a one to onebasis. Therefore, it is also helpful to work with local representative organisations to set up and deliverworkshops / focus groups to engage these groups.

• Delivering a combination of these engagement approaches in Slough would help to provide a detailedunderstanding of the characteristics and trajectory of the local economy, within the broad framework providedby the initial desk based analysis of the business intelligence datasets

• The core aim of any research on the characteristics of the local economy should be to provide:

• Up-to date and bespoke intelligence upon which to base future policy making

• A robust evidence base regarding needs and demand to inform future funding bids (e.g. to the LEP)

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AppendixThis section includes sector definitions

65

Appendix: Sector Definitions

2007 SIC Codes

ICT

• 58.2 Software publishing

• 61 Telecommunications

• 62 Computer programming, consultancy and related activities

• 63 Information service activities

Source: Witty Review (2013)

Pharma and Life Sciences

• 21100: Manufacture of basic pharmaceutical products

• 21200: Manufacture of pharmaceutical preparations

• 26600: Manufacture of irradiation, electro-medical and electrotherapeutic equipment

• 32500: Manufacture of medical and dental instruments and supplies

• 46460: Wholesale of Pharmaceutical Goods*

• 72110: Research and experimental development on biotechnology

Source: Witty Review (2013)* = Added by Regeneris Consulting due to high presence of these firms in Slough

Logistics

• 49.2: Freight rail transport

• 49.41: Freight transport by road

• 50.2: Sea and coastal freight water transport

• 50.4: Inland freight water transport

• 51.21: Freight air transport

• 52.1: Warehousing and storage

• 52.2: Support activities for transportation

• 53.1: Postal activities under universal service obligation

• 53.2: Other postal and courier activities

Source: Regeneris Consulting (2015)

Food Manufacturing

• 10: Manufacture of food products

• 11: Manufacture of beverages

Source: Regeneris Consulting (2015)

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slough business base analysis

Documents