Agenda item

Briefing Note of the Director of Business, Investment and Culture

The Business, Economy and Enterprise Scrutiny Board (3) received a briefing note and presentation of the Director of Business, Investment and Culture that detailed the support that local businesses had received due to the impact of the COVID-19 pandemic. A number of support initiatives had been delivered by the Economic Development Service, whilst they continued to work alongside local business support partners including Coventry & Warwickshire (CW) Chamber of Commerce, CWLEP Growth Hub, Coventry & Warwickshire Reinvestment Trust (CWRT) and Federation of Small Businesses (FSB). Critical to this effort was to enable the adaptation of the support schemes to the changing economic, social and health conditions, as they continued to offer a range of business support initiatives beyond the immediate COVID-19 support.

The presentation and briefing note highlighted the following issues:

Economic Context

·  The Economic Development Services had worked with key partners to adapt the business support offer to changing economic, social and health conditions and ensure they had done as much as possible to support local businesses through the Covid-19 pandemic

·  The nature of support services provided to businesses had evolved during the course of the pandemic due to changing economic circumstances: Covid-19 outbreak in March 2020 forced some sectors of the economy to close; social distancing limited the output of sectors remaining open

·  The UK economic output fell by over 21% in first two quarters of 2020, and by 9.9% overall in 2020.

·  West Midlands encountered the highest fall in economic output of any English region during the spring 2020 lockdown and was also projected to have the highest economic contracting of all UK regions during 2020

·  The UK economy remained 2.1% smaller than pre-pandemic levels

·  49,200 (30%) posts in Coventry were furloughed in June 2020, when the scheme closed at the end of September 2021, 5,900 (4%) were left on it

·  The Coventry unemployment claimant count doubled to 16,695 (6.7%) in October 2020 and as of October 2021 the claimant count stands at 13,945 (5.3%)

Health Inequalities Impact

·  There was a gap in life expectancy of 10.7 years (men) and 8.3 years (women) between the most deprived and affluent areas

·  Business Support services encouraged economic growth

·  Supporting and sustaining the economy in Coventry through Covid and protecting jobs

Covid-19 Support

·  EDS staff mobilised to deliver support to businesses in response to the COVID-19 pandemic - communication to businesses via website, e-newsletter, LinkedIn, Twitter and partner networks

·  £48m distributed in Government COVID-19 grants during 1^st lockdown - over 4,000 Coventry Retail, Leisure & Hospitality and small businesses supported and a further £2.7m in Discretionary Grants to 470 adversely affected businesses

·  Information communicated to businesses on CJRS and COVID-19 loans: 49,200 employees of Coventry firms furloughed at highest point; 7,400 Coventry businesses accessed loans, totalling over £300m; over 10,000 individuals accessed the Self Employment Income Support Scheme

·  £19.5m COVID-19 grants to 1,612 businesses closed since 4/11/20 plus £12.3m in Restart Grants to 1,880 Coventry businesses in non-essential retail and leisure

·  Design of £12.5m Additional Restrictions Grants (ARG) fund - to-date, 3,874 grants provided and strategy developed to allocate the final £1.8m ARG top-up fund earmarked for new applicants that missed out on previous rounds

On-Going Business Support

·  Nearly 10,000 businesses in Coventry, many of which were Small and Medium Enterprises (SMEs)

·  Coventry’s SMEs continued to need advice, access to finance and infrastructure

·  Partnership working was key to help grow and develop SME business base

·  Support services are designed to help SMEs fulfil their growth potential, and is delivered: Directly though EDS Business Advisors; Webinars to replace Workshops; 1:1 support delivered via video conferencing

·  Support tailored to the needs of individual Business

·  SLA with Coventry & Warwickshire Local Enterprise Partnership Growth Hub ensured local businesses were referred to the most appropriate support available

·  Coventry & Warwickshire Chamber of Commerce supported new businesses to successfully start - demand for start-up support increased through 2020 and £249k of COVID-19 Discretionary Grant funds allocated to expand start-up support

·  The four EU-funded support programmes managed by EDS continued to be integral to the Council’s business support offer: CW Business Support; CW Green Business; CW Innovation Programme; CW Skills for Growth - since March 2020 all four programmes had applied flexibilities in delivery methods to ensure services were able to continue and had secured extensions through to June 2023 (worth £9.2m of EU funding).

·  Take-up of suite of support services had remained high during 2021: programmes had supported 175 SMEs (Q1 to Q3) to adapt, modernises and innovate / diversify; 40 of these were new businesses; Green Business Network webinars regularly had 50+ attendees; the CW Innovation programme saw increased demand for 1:1 support and usability studies; new Skills 4 Growth project: 155 employees across 61 SMEs supported to address skills gaps in Quarter 1 – Quarter 3 2021 alone

·  £2.4m of grants were awarded in 2021 to date, supporting: the creation of 26 new jobs; a reduction of 578 tonnes of CO2 emissions

·  £500k tourism grant pot allocated (claimed by 209 SMEs within two days of launch) 

·  Inward Investment service was receiving significant interest - 14,554 jobs created from 216 Coventry & Warwickshire FDI projects (2016-2020)

The Board questioned officers, received responses, and discussed the following issues:

·  There were currently 3,000 job vacancies in the city with a large number of these vacancies in the hospitality industry and, although the skills for these positions were available, there was a reluctance to take-up vacancies in this area.

·  European funding had been extended to June 2023 – the US Share Prosperity Fund would replace Eu funding streams in the longer term. Prospectus awaited in the New Year.

·   Coventry Creative Growth and Cultural Tourism Recovery Programme - Community Renewal Fund successful application - would enable the delivery of a pilot project, which would support the continued growth and competitiveness of cultural sectors in the whole of Coventry, not least through realising the unique opportunities presented by UK City of Culture 2021, the 2022 Commonwealth Games, and associated Legacies.

·  The Community Renewal Fun success would enable freelancers and creative and cultural businesses to be supported. It was currently difficult to determine how successful their recovery was progressing.

·  There was a 2% Covid ‘economic scaring’ however, the longer-term effects were difficult to quantify. The economy was very different at present.

·  The manufacturing sector, mainly in the field of electric vehicles for which Coventry had a world class reputation, were showing interest in International Investment in the city

·  Universities were important employers in the city as well as learning providers – the drop in numbers of international students during the pandemic had resulted in a loss of income

·  New businesses could access start-up support from the Chamber of commerce

·  The Furlough Scheme ended on 31^st October 2021 – many employees have been re-employed by their companies, others have left the labour market (retired) and some had been made redundant. There hadn’t been a noticeable spike in unemployment figures resulting from the ending of furlough.

RESOLVED that the Business, Economy and Enterprise Scrutiny Board (3) noted the content of the briefing note and the presentation and thanked the officers for all the work they have undertaken supporting businesses through the pandemic.