Defence cuts in the Hampshire ports have shifted the focus from military-related employment towards a tourism and service-based economy. Graham Parker explains.
Hampshire has long been one of the most prosperous regions of the UK. Southampton, Portsmouth and Chichester Harbour have all been important ports – both commercial and military – since Roman times. And, on the back of the port activity, a strong industrial and commercial base developed.
Shipping is still a significant part of Hampshire’s economy. Portsmouth is Britain’s second-busiest ferry port; a £9m terminal built in the early 1990s means it can take the very largest of the new generation of “super ferries”. Southampton’s docks handle about 7% of the UK’s seaborne freight trade, with approximately 30,000 people employed in marine-related businesses in the area.
However, the defence-related industry has been the mainstay of the local economy, especially in Portsmouth. At its peak during the second world war, the city’s naval dockyard alone employed 26,000 civilians, and even in the 1970s most households in the city still counted on the industry for their livelihoods.
The 1981 defence review marked the beginning of the downturn for military activity in the area. And uncertainty continues because 1,500 jobs in Southampton and Portsmouth are currently at risk unless the naval shipbuilder Vosper Thorneycroft wins a new government order for the next batch of naval frigates. The government faces a difficult choice between Vosper Thorneycroft and Yarrow on the Clyde.
The defence cuts have had a knock-on effect on the local electronics sector. These firms originally concentrated in Hampshire because the military was its biggest single client. For example, IBM has its UK headquarters at Cosham, just north of Portsmouth. Other big employers include Marconi at Southampton and GEC at Fareham. These defence suppliers are increasingly turning to consumer products, but they find themselves in a very competitive market.
Hampshire has become a predominantly serviced-based economy. In recent years, the area’s excellent communications have attracted businesses relocating from London. This, in particular, was responsible for the growth of Basingstoke – a New Town – as one of the county’s main commercial locations.
Portsmouth and Southampton have also had some success in attracting office users relocating from the capital. Zurich Insurance is an important employer in Portsmouth, more so since its takeover of MMI two years ago. And Skandia Life purchased an office building in Southampton.
But tourism is now being recognised as a growth industry of the future. Hampshire county council estimates that it now generates £400m pa for the county – or 3% of total GDP.
Portsmouth has led the way in developing its tourist attractions. The raising of the Tudor ship the Mary Rose and the return of HMS Warrior have complemented the existing attraction of HMS Victory. Between 1983 and 1991 day trips to Portsmouth rose from 2.4m pa to 4.5m pa while night visits soared from 900,000 pa to 3.4m pa.
The economic value of tourism to Portsmouth rose in line, from £50m pa to £300m pa over the same period, while the number of tourist-related jobs has more than doubled to 7,900.
Now the city’s strategy is to build on this success. The Millennium Commission’s decision to site one of its first two major projects in Portsmouth will give tourism an added boost.
Lottery money is being made available – on the understanding that funds will be matched by the private sector – to regenerate Gun Wharf, a 5km (3.1 mile) stretch of waterfront which has been locked behind Ministry of Defence gates up to now. The local council and Vail Williams, who are promoting the scheme, believe it will create another 3,500 jobs.
1991 census
Total households 603,300
One person 145,200
Lone parent 20,400
Pensioner only 144,500
Owner occupied 72.5%
Private rented 11.8%
Local authority rented 15.7%
Unemployment rate (October 1995): 5.9%
Population – 1996
Basingstoke & Deane 148,400
East Hampshire 109,000
Eastleigh 111,700
Fareham 103,000
Gosport 77,600
Hart 83,200
Havant 118,600
New Forest 166,200
Portsmouth 186,000
Rushmoor 87,800
Southampton 205,900
Test Valley 103,300
Winchester 100,100
Hampshire (total)1,606,300
Employment
Agriculture,forestry & fishing1.5%
Energy and water1.1%
Engineering10.1%
Other manufacturing5.7%
Construction2.9%
Shops, hotel and catering22.5%
Transport & communications5.5%
Finance & business services18.5%
Public administration, education & health28.0%
Community, social & personal services4.2%
(Total 592,500)
Firms employing:
under 1125,500
11 to 245,100
25 to 993,500
100 to 499,800
500 and over,100
