The RSN's Observatory is the place to discover the statistics behind key issues facing rural communities in England, issues that the RSN is striving to highlight and tackle through its work.  The Observatory is additionally a great place to understand the numbers that define the communities within our membership through an expanding group of analyses, with this body of work soon to be given its own area on the RSN website called Member Insights.

Keep checking the 'What's New' section of the RSN's weekly Rural Bulletin to discover the latest RSN analyses and Observatory work.

In this edition of the 'Spotlight on the RSN Observatory', Dan Worth, our Research and Performance Analyst explores business sectors in rural and urban local authorities, and the composition of employment and number of enterprise units.

Composition of Business Sectors

All data used within this article relates to the year 2017, comes from the Business Register and Employment Survey and UK Business Counts.  Local authority rural/urban classifications are used in the calculation of the rural/urban averages.

For the data being used 'enterprises' should be thought of as the overall business, made up of all the individual sites or workplaces.  It is the smallest combination of legal units that has autonomy within an enterprise group.  An 'employee' is anyone aged 16 years or over that an organisation directly pays from its payroll, in return for carrying out a full-time (more than 30 hours a week) or part-time (30 hours a week or less) job.  'Employment' includes employees plus the number of working owners (ie. self-employed registered for VAT or Pay-As-You-Earn).

The proportion of employees/employment/enterprises in each industrial sector is an indicator of the relative importance of certain sectors within a geographical area.  It provides insight to potential over reliance of employment through certain sectors, and conversely shows where sectors, particularly where they provide additional benefits such as higher wages or more employment stability, are underrepresented.

Employment

The top sectors for overall employment (full-time and part-time) in Predominantly Rural local authority areas in 2017 were Health (12.1%), Manufacturing (11.7%) and Retail (9.9%).  These were also the top sectors in Urban with Significant Rural areas with 12.5%, 9.7% and 9.9% of employees employed respectively.  Health (13.1%) and Retail (9.4%) are likewise top employers in Predominantly Urban local authority areas, but Manufacturing (6.9%) is significantly lower and its position is replaced by Business Administration & Support Services (10.1%).

Manufacturing is the stand out employer of full-time employees for both Predominantly Rural and Urban with Significant Rural areas.

Retail, Accommodation & Food Services, Education and Health are top employers of part-time employees for all classification of authority area.  Business Administration & Support Services is additionally a top employer of part-time employees in Predominantly Urban areas.

In terms of all employment, the situation is very similar for all classifications to that for employees.

Looking specifically at Predominantly Rural areas, it is noticeable that the proportion in employment for Agriculture, Forestry & Fishing (4.7%) is twice the level of that for employees employed (2.2%), demonstrating the importance of self employed working owners to this business sector.

Enterprises

The sectors that have the highest proportion of enterprises in Predominantly Rural areas are Professional, Scientific & Technical (15.5%), Construction (12.5%) and Agriculture, Forestry & Fishing (12.5%).  It is interesting to note that these sectors do not reflect the situation for composition of employment in Predominantly Rural areas, and this is true also in Predominantly Urban and Urban with Significant Rural areas.

The sectors that have the highest proportion of enterprises in Urban with Significant Rural areas are Professional, Scientific & Technical (18.9%), Construction (12.9%) and Business Administration & Support Services (8.3%).

Enterprise sizes are categorised as:

The composition of micro enterprises matches closely that for all enterprises, which is to be expected due to the volume of enterprises in this category being greatest.

It is unsurprising to note that within Predominantly Rural areas, Accommodation & Food Services make up the greatest proportion of small enterprises (17.1%), both due to the nature of the business as well as the nature of the environment of rural areas.

As the size of enterprise increases, and with increasing rurality, the composition of sectors becomes more polarized, with certain sectors dominating.  Those sectors that make up more than 10% of large enterprises for each of the classifications are:

Individual authorities will naturally have quite particular enterprise and employment compositions based on their individual circumstance.  The above analysis and commentary provides an overall picture of how rural areas compare to urban areas, which provides a snapshot of the situation as it stands as well as points to consider in supporting and developing strong rural economies.  Further detail on individual authority economic profiles can be found in the Observatory section of the Rural Services Network website.  The RSN will continue to develop its' economic service for the benefit of member authorities, so continue to check the website and the weekly Bulletin for the latest information.