ECONOMIC CLIMATE UPDATE REPORT
EMPLOYMENT AND BUSINESS
Following the report to Cabinet in December 2008 a regular update of the local economic
climate was requested to be reported to each Cabinet meeting. The following is a summary
of the positive and negative economic changes that have taken place since the previous 5th
? Billingham-based pump manufacturer Tomlinson Hall has seen year-on-year growth
of 7.5%-10% over four years increasing turnover to more than ?3m.
? Billingham based Biochemical company CRB has won new orders and clients in
recent months after revamping its business plan.
? One owner of Eaglescliffe based manufacturer the Bottling Company has
purchased Sunderland based Villa Drinks.
? Able UK successfully secured the contract to recycle the French air craft carrier Le
Clemenceau, now in position at Graythorp Dock, 200 jobs to be created.
? Billingham firm Cotswold Manufacturing Limited received the Manufacturing Award
at the Best New business Awards 2008.
? UPDATE: Corus has sold its subsidiary Teesside Cast Products. Italian firm
Marcegaglia will become a majority stakeholder in the Redcar plant alongside South
Korean firm Dongkuk. About 2000 people are employed at the plant.
? UPDATE: Nissan have announced a further 20,000 redundancies worldwide
however this announcement excludes the Sunderland plant, which has secured
Nissan‟s new Qazana model expected to enter production in 2010.
? SABIC has temporarily shut down part of its cracker complex at Wilton following a
drop in demand, no redundancies or major reductions in staff working hours are
? Nearly 200 staff at the Petroplus oil refinery on Teesside are threatened after the
Swiss-owned firm announced it was considering strategic options including sale,
stating that the refinery requires substantial reinvestment.
? 160 contract workers at Seal Sands based INEOS Nitriles will not be kept on as work
is shifted to its in house team of staff.
? UPDATE: SeaDragon Offshore plan to remove work on one of two drilling rigs from
Haverton Hill shipyard to Singapore after previously agreeing a contract with Tees
Alliance Group (TAG) for the work. It is hoped that some work can be salvaged on
? E-commerce specialist Visualsoft is to triple its staff as it forecast a ?1.5m turnover
this year, based at Preston Farm, around 10 staff will be recruited over six months.
2 ? Mandale Fine Furniture of Portrack and the jobs of its eight staff have been saved
after it was bought by giftware chain Collectables.
? BrightHouse are to open five new outlets in Tees Valley, stores are planned for
Billingham and Thornaby.
? The ?30m EDS Data Centre at Wynyard is due to be completed December 2009, 30-
40 new jobs to be created.
? Reuben Manor a new ?5m care home due to open June 2009 in Yarm are looking to
recruit 100 staff.
? UPDATE: 20 jobs at the former garage chain deVries have been saved. The
Stockton dealership has been sold to the Benfield Motor Group ? UPDATE: Carterbar, of Billingham, has taken over Hartlepool company Retirement
Options; the move follows the purchase of similar companies in Sunderland,
Tyneside and Durham over the past 12 months.
? Stylo the owner of Barratts Shoes and Priceless Shoes have put both chains into
administration; nationally around 5,400 jobs are under threat, Priceless are located
within Wellington Square.
? JSA figures for January 2009 show 5,537 claimants in Stockton, which represents
4.6% of the working age population. An increase of 0.5% or 699 more claimants on
December 2008. This is 1,829 more than a year ago, (Jan 2008, 3708 3.1%) but
Stockton is still lower than the rest of Tees Valley which is 4.8%.
? There were 1208 new claims to JSA in January 2009, 979 of which were men. There
was a 50% increase in new JSA claims in the North East between November 2008 to
January 2009, Stockton showed an increase of 49%, compared to the volumes of
new claims for the same period 2007/2008
? Total numbers of people on all benefits in Stockton (most up to date figures to Aug
2008) is 20,020, an increase of 0.4% to 16.8% from Nov 2007, but compares with
19,660 in Aug 2007, and 20,250 in Aug 2006.
? The number of Incapacity benefit claims has generally been steadily decreasing
across the District since 2003, but Stockton showed a slight increase of 50 people,
from May to August 2008. This may be partly attributable to the closing of Remploy
in Summer 2008
? There were 528 job vacancies notified to the Jobcentre Plus offices in Stockton in
January 2009 compared with 938 in January 2008. Local Employment Partnerships
accounted for 229 of these vacancies, offering employment opportunities to priority
? There were 394 unfilled vacancies for January 2009, 138 were LEP vacancies. The
vacancies unfilled include over 200 in financial services across Stockton, Billingham
and Thornaby, over 80 in retail and, 63 in Construction.
? The Primrose Hill Industrial Estate currently has 100% occupancy within its industrial
and training units and a 94% occupancy rate within its Business Centre.
3 ? The current occupancy rate of the Stockton Business Centre is 75% - a reduction of
2% from the February update. TJ‟s catering has moved into the vacant Café Unit and ndcommenced trading on the 2 February 2009.
? Company failures in the North East have increased by 98% in a year according to
Deloitte. In 2008 there were 101 administrations compared to 51 in 2007.
? Experian report that there were 540 insolvencies in the region in 2008 a 61%
increase on the previous year and a 77% rise in the last three months of the year on
the same period in 2007.
? The NNDR collection rate is showing a small decrease, 95.54% up to January 2009
compared with 97.10% at January 2008. Council Tax collection shows a slight
increase, 93.46% in January 2009 compared to 93.28% in January 2008.
? All of the companies short listed for the Tees Valley Company of the Year award
thannounced 17 February are from Stockton Borough they are, injection moulding
specialists Nifco UK, Reflex Vehicles Solutions, and diagnostics company Tracerco.
OTHER ECONOMIC INFORMATION
Support for Business
? A number of Tees Valley companies are attending the North East Regional Business
Fair to be held 25 – 26 February in Newcastle, this „Meet the Buyer‟ networking event
will bring more than 150 national buyers to the region.
? The NECC is to hold a seminar on Banking 12th March 2009 to support local
business. The seminar will cover to what extent recent policies have made a
difference, and what further measures the NECC should call for on behalf of business.
? One North East have launched their „Real Help for Businesses Now‟ media campaign
to highlight business success, and to signpost companies to the support on offer.
One North East is working with the LSC, Jobcentre Plus, Business Link and
Government Office for the North East to coordinate this and ensure a consistent
message goes out from these key agencies.
? A dedicated logistics training centre has been launched based at Middlesbrough
College, Logistics Academy North East (LANE) will provide a single point of support
for employers in the freight, logistics and transport sectors.
? One North East has launched a ?2.4m grant scheme for large businesses entitled the
Large Company Research and Development Grant.
? The Royal Bank of Scotland and HBOS groups have both unveiled ?250m loan
packages for North East SMEs as part of a wider ?3bn national package funded by
the European Investment Bank.
? Business Link North East has assisted 545 businesses in the third quarter of 2008/09
financial year, this demonstrates an upward trend with 472 assisted in Quarter 1 and
426 in Quarter 2.
th? The Business Link „Weather the Storm Event‟ held 19 February at Wynyard was
attended by in excess of 50 businesses.
? The recent announcement of the closure of the BMI daily flight to Heathrow is likely to
have an impact on Stockton‟s and the Tees Valley‟s economy. As a result, a paper
has been prepared by JSU for Tees Valley Unlimited for lobbying Transport Select
Committee. A summary of that submission is attached as Appendix 2.
Support for People
? The LSC have contracted with CfBT Education Trust to deliver the Nextstep service
in the North East. Nextstep is able to work in partnership with Businesses, Jobcentre
Plus, Business and Enterprise North East and other agencies to provide support to
people facing redundancy.
? Due to the revaluation of the Euro an additional ?6.9m of European Social Fund has
become available which once matched becomes a total fund of ?13.7m. This will
help implement the regional Employment & Skills Response Plan by providing
support specifically for those facing redundancy and those who have already been
made redundant ensuring that people have access to the support they need to
develop the skills and help them find new employment in local labour markets.
HOUSING AND DEVELOPMENT
? Funding for 14 additional affordable homes has been secured through the Homes
and Communities National Affordable Housing Programme. Funding for 8 additional
units for rent at College Gardens, Billingham and 6 additional units for rent at
Hardwick Green, Stockton was secured.
? In February the Council‟s Housing Options service co-located with the Tristar Homes
Allocations service to Stratford House in Stockton Town Centre. From here they will
be able to deliver an enhanced housing options service that will incorporate the new
Choice Based Lettings Scheme (from April 2009).
The statistics below show key data from the Housing Service and compares them with
Monthly Housing Benefit Workload Applications on the Council’s Housing Register (including transfers) December 2007 - 4,501 January 2008 - 7,271 November 2008 - 3,998 December 2008 - 5,909 December 2008 - 4,231 January 2009 - 9,307 January 2009 - 4,117 There has been a 28% increase in Housing Further data cleansing exercise has led to Benefit workload in January 2009 compared decreasing number on the register. Choice with January 2008. Benefit teams are based letting applications sent out however currently working overtime and taking on applicants have decided to remove themselves
experienced agency staff to help clear benefit from the list rather than complete a new form.
claims. Temporary staff are also being
recruited to train in claims processing.
Number of households approaching
the service on homeless grounds
January 2008 - 48
November 2008 - 93
December 2008 - 75
January 2009 – 106
Number of approaches to the Housing Number of housing options customers
Options service seeking assistance with mortgage/rent
arrears January 2008 - 186
December 2008 - 153 January 2008 - 9 January 2009 - 272 November 2008 - 7
December 2008 - 12 January is traditionally a busier month for January 2009 - 21 approaches however there was a 46% increase in January 2009 compared with
January 2008. There has been some
redistribution of workload to ensure frontline
staff have additional capacity to deal with the
increase in approaches.
Number of House Sales in the Average monthly House Prices in the
borough (source: land registry) borough (source: land registry)
September 2007 - 354 November 2007 - ?136,393 October 2007 - 401 December 2007 - ?136,434 September 2008 - 143 November 2008 - ?126,503 October 2008 - 176 December 2008 - ?122,645
STOCKTON BOROUGH COUNCIL RESPONSES
? Additional support to encourage more enterprise in the Borough over the next three
years is being funded from the Communities Fund and ERDF. The projects include
encouraging an enterprise culture amongst young people, establishing Enterprise
Gateways in the more disadvantaged areas and supporting small businesses to
overcome barriers to growth. This forms part of a wider Tees Valley ERDF package
of projects that has recently been announced in the press; however a formal approval
letter for the ERDF has not yet been received from ONE but is expected imminently.
? An information bulletin detailing available support for business is being issued with all
forthcoming Stockton Borough Council business rates bills.
? The “Busting the Credit Crunch”, event held at Stockton Parish Church saw Stockton
Borough Council, Tristar Homes, Tees Credit Union and Stockton District Information
and Advice Service give guidance to close to 100 residents.
? Stockton Renaissance held a „Credit Crunch‟ workshop as part of its February
meeting for attendees to discuss the localised impacts of the economic downturn
upon Housing Issues, Major Development Projects, the Third Sector and
Communities across the Borough. Forthcoming risks were discussed alongside
possible intervention measures, joint working and positive actions already underway.