Recession hits West Midlands hard
The economic downturn – now confirmed as a recession – appears to have hit the West Midlands harder than most areas of the UK.
Unemployment figures released on Wednesday show the four constituencies with the highest unemployment figures are in inner-city Birmingham while the rate across the region is 7.1%.
Recent months have seen a spate of job losses across the region’s manufacturing base.
The automotive industry – which employs more than 100,000 across the region in vehicle manufacturing and the components sector – has been particularly badly hit.
Aston Martin, in Gaydon, Warwickshire, announced 600 job losses – a third of its workforce – in December.
Jaguar Land Rover, with plants in Castle Bromwich, Solihull, Coventry and Gaydon, cut 450 jobs earlier this month and has severely cut back on production.
JCB, in Rocester, Staffordshire, cut nearly 700 jobs in December.
And in Birmingham, van maker LDV cut 95 jobs in November and has not yet set a date for production to restart.
It is a similar tale in the ceramics industry in Stoke-on-Trent, where Waterford Wedgwood, now in administration, has cut nearly 600 jobs since August.
Jesse Shirley and Son Limited also cut 55 jobs earlier this week.
And business leaders have warned the situation is likely to get worse before it gets better.
Chris Clifford, regional director of the CBI in the West Midlands, said: “It’s a very, very difficult situation at the moment obviously.
“We really do rapidly need to get credit flows moving within the economy fairly quickly.
“The sooner we can do this the sooner we stand a chance of coming out the other side.
“The longer it takes the longer the recession, I fear.”
‘Just scandalous’ He added: “It’s going to be tough, it’s going to be across all sectors, not just manufacturing.
“It’s retail, financial services, hotels as well. There are job losses likely in the public sector particularly in local authorities and others.”
Roger McKenzie, of TUC Midlands, backed businesses’ calls for more credit.
He said: “The problem’s with the banks. They’re quite happy to pass on the interest rate cuts in terms of affecting everybody’s savings so our savings are worth nothing but not as fast to pass on mortgage interest rates.
“It’s just scandalous. Employers can’t get credit and it impacts on everyone in the production line.”
He added: “Retail hasn’t had it like this before. The finance sector got us out of recession last time but that’s not the case this time because they’ve been hard hit.
“Lots of sectors which haven’t experienced this before are now experiencing it.”
Tourism boost But it is not all doom and gloom.
Stratford-upon-Avon, the birthplace of Shakespeare, regularly attracts about two million foreign tourists each year.
And tourist chiefs predict the weak pound will cause US, European and Japanese tourists to see the Midlands as a bargain destination for a holiday.
Phil Hackett, chief executive of Shakespeare Country, said: “It’s going to be the best price for an American visitor to come to the UK since 1976 because of the value of the dollar against the pound.
“People coming in from outside the UK will be injecting extra cash into the economy.
“The only issue we have got is the extent of the economic downturn in other countries.
“How many Americans are thinking of taking a holiday?”
Outside of the big cities in rural Shropshire, the county’s chamber of commerce is also hoping that tourism will rise, not least from UK holidaymakers put off by the high exchange rate with the Euro.
Things are bad here too, but while manufacturing in and around Telford has been hit, recruitment actually rose by 6% during the fourth quarter of 2008.
Director Richard Sheehan said: “Because we have a rural community when business is flying we never really see the enormous highs.
“Likewise, when everything’s going down rapidly, we don’t go into the really bad troughs in most places. “We tend to be a bit more consistent.”
Stratford-upon-Avon, the Warwickshire birthplace of William Shakespeare, has suffered a difficult time in recent years.
Foot-and-mouth disease, the slowdown in US tourists after 9/11, flooding and building work at the Royal Shakespeare Company’s main theatre have all led to fears of doom and gloom for the town’s tourist industry.
Last month Shakespearience, a tourist attraction devoted to Shakespeare, called in the administrators blaming the credit crunch, a lack of overseas visitors and disruption caused by the redevelopment.
Despite this the town’s streets have remained busy and visitors, mostly from the UK, have been flocking in.
And since the opening of the Royal Shakespeare Company’s latest production of Hamlet, the town could be said to be enjoying what might be called the “David Tennant effect”.
The five-month production, which started earlier this month and stars the popular Doctor Who actor, is sold out with tickets selling at inflated prices on auction websites.
It seems to be having a good effect on the town with visitors travelling to see the production making a day of their stay in the town.
Helen Robson, promotions manager for the Shakespeare Birthplace Trust, a charity which own five Shakespeare houses in the town, said they were getting “decent” tourist figures after what had been a “trying” few years.
She said: “Certainly at the Birthplace Trust we have people coming in, especially women, who say we are here to see Hamlet and so we thought we would come and find out more about what it’s all about.
“I think the RSC is riding the crest of a wave with David Tennant.
“The production is drawing in people from further afield than normal so people are spending more time in the town and going on the Stratford trail.
“They are coming in for an evening show and spending the day and possibly overnight in town.”
In general the town has not been seeing too much evidence of the so-called credit crunch, she said.
“The credit crunch has affected overseas tourists more so than in the UK,” she said.
“It’s not that US visitors are staying away completely, it’s that they are not arriving in coachloads as they once did.
“But we are seeing a lot more local visitors, exploring what’s on their own doorsteps.”
South Warwickshire Tourism, the area’s tourist board, said visitor figures had picked up this year but agreed the production of Hamlet was having an even more positive effect.
Chief executive Phil Hackett said: “It is difficult to measure the ‘Tennant effect’ because the RSC have had a number of record seasons in a row.
“But I would argue that as Hamlet has been sold out since May this year that there is definitely a positive impact.”
The RSC said all its productions were doing well, not just Hamlet.
Despite its tourism success, civic leaders say the town still needs to start pulling in the foreign tourists again.
And the town needs something, other than Shakespeare, to bring them in.
So says Les Topham, the leader of Stratford District Council.
He said “a lot of people are not Shakespeare fans but they are Stratford fans.
“They come to see the river and the town. Of course we would like more visitors and we would like them to stay longer.
“Stratford is a wonderful place but could do with a facelift. I would like to see more gardens and a place to hold more entertainment and variety shows.”
STRATFORD UPON AVON
Shakespeare Country’s Phil Hackett predicts a boom in tourism.
MAR 31, 2009
Is William Shakespeare about to come to the rescue of the country’s economy?
Or as the bard himself might have put it; is our winter of discontent about to be made bright summer by the tourism industry?
That’s certainly the view in Shakespeare’s home town.
The season is barely underway but already Stratford Upon Avon is busy with tourists.
Our worsening economy and weakening pound has led many analysts to predict a bumper year for Britain’s tourist industry.
Phil Hackett, the Chief Executive of the evocatively named Shakespeare Country goes even further.
“We think it could be our best year ever,” he told me when Working Lunch visited the town.
Weak pound is big business
“We’re expecting more people in the UK to holiday at home this year rather than go abroad, plus the weakness of the pound against the euro and the dollar should boost the number of overseas visitors too.”
But will the tourists come?
The Brits I spoke to among the crowds strolling down the main street were convinced it would be a good year.
But the Americans weren’t so sure, Evelyn Sexton and Shelley Hickman , visiting from Tennesee were loving every minute of their UK trip.
“We’re having a fantastic time. The buildings here are lovely, and there’s so much history.”
“But things are tough back home. The strength of the dollar has made it easier for us, but I still think a lot of people are going to be reluctant to spend all that money to come to Britain.”
Relying on tourism
So is it a good idea to be putting so much emphasis on tourism?
After all, many of the jobs it supplies are low paid, seasonal and as the Americans illustrate, it’s vulnerable to problems in the home economies of the people you’re hoping to persuade to visit.
It’s no coincidence that two of the areas with some of the lowest GDP in the UK are Cumbria and Cornwall, where the economy is heavily reliant on tourism.
Roger Allonby is the man spreading the tourism gospel in Shakespeare Country. He’s Head of Tourism for the area’s regional development agency, Advantage West Midlands.
“Any economy needs lots of elements to it, and tourism is a really important industry to have,” he said.
Roger says the industry may be worth as much as £1bn to the region’s economy.
“But what’s often not considered is that many people in the area will work in tourism at some point in their careers, often as students for example. And they’ll pick up all the kind of service skills that are so important in the modern economy.”
Building the economy
Mind you, anyone looking for the peace and olde worlde tranquillity right now might not find it in Stratford.
Large parts of the town, including the usually relaxing green spaces by the River Avon, have been turned into a building site.
That’s because £100m is being poured into Stratford to refurbish everything from the Royal Shakespeare Company’s centre to the house reputed to be the birthplace of the great man himself.
“We’re in a worldwide competition these days to win customers,” explained Phil Hackett.
“Tourism is opening up everywhere, and even though Shakespeare is a world-wide icon, we have to make sure that our facilities here are up to date so that we can compete.”
It seems to be working. Roger Allonby says early reports show that visitor attractions across the West Midlands are up 10 to 15 percent on last year – figures that few other industries could boast.
That’s not difficult to believe when you look at the hordes thronging Stratford Upon Avon this spring.
Stand in the street and you’ll see thousands of people speaking dozens of languages, all taking snapshots of the black and white Tudor buildings, and all looking for somewhere to spend their tourist money.
Shakespeare wrote that “all the world’s a stage”, back in his hometown they know that all the world’s a potential market too.