The Open Access Government feature the thoughts of Professor Jeremy Phillipson, Director of the National Innovation Centre for Rural Enterprise and Paddy Bradley, CEO of Swindon and Wiltshire LEP on unlocking the contribution of rural enterprise and “levelling up”

Over many decades, rural economies and their diverse sources of enterprise have been overlooked within mainstream policies – whether it be debates about national productivity, industrial strategy, society’s response to long term grand challenges or the ‘levelling up’ agenda.

Either treated too narrowly, so associated only with sectors like agriculture, tourism and traditional industries or eclipsed by approaches seen through the lens of cities as the presumed locus for growth, innovation and regional development, rural enterprise has been underexplored and underutilised.

Why an enterprising countryside matters for levelling up

Drawing rural economies comprehensively into the nation’s plans for recovery and strengthening economic performance is important for several reasons:

• Their significance – In England alone, a GDP of over £260 billion, representing over half a million enterprises and 3.5 million employees across all industries and sectors.
• Untapped potential – Evidence suggests substantial latent opportunity, such as for exporting, innovation in goods or services, or entry to new markets.
• The contribution of rural areas to the nation’s natural resources, green space and health and to underpinning urban and regional performance and resilience.
• Their potential as test beds for innovation – Rural areas can play a key role in pioneering more creative responses to ageing populations, harnessing mobility and digitalisation for goods, services and people, and realising the value of natural capital for clean growth.
• The rural productivity gap – According to Government data, rural productivity is currently 85% that of urban (excluding London), with the productivity gap growing.
• The economic and social impacts of COVID-19 – Over 1.6 million jobs in rural areas have been furloughed and many rural places dependent on visitor economies have been especially hard hit. However, suitably enabled, rural areas are also set to be at the vanguard of accelerated preferences for remote working and living, as businesses and employees realise that in many instances they can work remotely away from the crowds.

Part of the levelling up challenge and solution

Rural economies are, therefore, part of the levelling-up challenge and also part of the solution. This means capitalising on the performance, innovation and untapped potential of rural enterprise, whilst also addressing longstanding barriers. A preponderance of highly dispersed sole traders and micro-businesses presents particular difficulties for coping with regulations/red tape, business collaboration and networking, access to skilled labour, services and finance, and in more remote areas, ‘new to the market’ innovation. COVID-19 has demonstrated how digital connectivity and competencies matter more than ever. Yet many SMEs with goods and services suitable for sale via the Internet and social media don’t have the setup or knowhow to fully exploit this potential. Weaknesses in some rural areas in affordable housing, transport infrastructures and education plus services provision also hold back businesses and require integrated, place-based solutions.

The full article which features further information can be accessed here