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2001 Conference - Rotorua
  
Economic Impact to Date
From the first days of the outbreak in this region there have
been deep concerns about the long-term impact on the local economy.
This impact is magnified by the nature of this economy, where
agriculture remains a dominant industry, as illustrated by the
following statistics:-
- Agriculture and related services represent 23% of the region's
Gross Domestic Product (GDP) compared to 3% for Scotland as a
whole
- Agriculture's share of employment in the region is around 14%,
four times the Scottish average
- 42% of businesses in the region have a direct connection with
the agricultural sector, compared to 16% for Scotland as a
whole.
Scottish Enterprise Dumfries & Galloway has commissioned a
large scale research project across all sectors, size of business
and geographic area to provide robust data from which to evaluate
the scale of the damage inflicted by FMD on the region's economy.
The following key findings from the first detailed set of data
reflects the views and experience of businesses since the start of
the main epidemic.
- Only 28% of the sample from a business base of approximately
6,500 said they had not been effected by FMD.
- 52% of business stated they have definitely lost trade since
the outbreak of the disease
- Of those who had definitely lost business, two thirds believe
they have incurred additional business losses which they are
unable to precisely quantify
- Average losses during the period range from Tourism ?6k and
Retail ?8k, to Agriculture ?31k and Other Services ?27k
- The average loss across all businesses is ?10k which is
expected to rise to ?30k after 3 months and ?70k after 6
months
- Sole Traders and those employing less than 5 staff have been
most effected. (92% of businesses in the region are micro
businesses with 16% of the work force self-employed)
- Geographically the effect has been spread relatively evenly
across the region
- As anticipated reductions in full time staff will be gradual,
reflecting the Employment Service figures of just a 6% increase
to date on the previous unemployment total of 4000
- However 16% of businesses expect to reduce employee numbers if
the situation continues for 1 month with a third expecting to do
so if it continues for 6 months
- Seasonal employment is a key factor in the household economy
in Dumfries & Galloway. 24% of all businesses normally
employ part time staff . This figure is set to almost halve
- 48% of tourist business normally employ seasonal staff. Only
19% now expect to do so
- If the restrictions and economic situation continues, 25% of
all business expect to close within six months.
What makes the above such grim reading is that it is bearing down
on a region which by every key indicator already has one of the most
fragile economies in the UK. One of the lowest average weekly wages
which last year fell even further; one of lowest GDPs; one of the
lowest numbers of managerial, professional and technical employees
per head of the population; one of the lowest examples of
productivity per worker; a rapidly declining younger population; 80%
of all businesses with a turnover of less than ?250k.
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