by Greg Wilson and Gerard Hughes
It is often claimed by developers and their consultants that their retail proposals will help to regenerate the local economy and provide new jobs. Usually these claims emerge when substantial objections to the scheme are expected and the developer reaches for plus points to aid his case. All planning decisions are, or rather should be, made on a balance of planning merits, and it is essential to consider the broad range of economic, environmental and retailing benefits and non-benefits which may accrue from a proposal. While it may be tempting to exploit the apparent potential economic advantages of a particular proposal — particularly in areas of high unemployment — extreme caution should be exercised when assembling the case for achieving planning consent. This article highlights some of the common misconceptions associated with the retail employment debate and concludes by advising any developer to consider very carefully employment issues before making extravagant claims as to their benefits.
Many parts of the UK have recently been under intense pressure for retail development. Retailing is a dynamic and constantly evolving sector of the economy, so it is hardly surprising that changes in the shopping scene also have very significant consequences for the structure of retail employment. The National Economic Development Office(1) has shown that the absolute number of retail jobs increased nationally between 1977 and 1985 by 5%. However, these figures include a substantial substitution of part-time for full-time employment.
In reality there has been no overall growth in employment in retailing and the general trend is downwards. Between 1974 and 1985 part-time female employment in retailing increased by 20%, while full-time female employment declined by 14%. Although there is little up-to-date evidence on a national scale, local studies further emphasise that retail employment is female orientated and becoming increasingly part time in nature.
On closer examination, Department of Employment estimates show that total employment in retail distribution (employees only) in the South East increased by 6.5% between 1977 and 1985, indicating the importance of the retailing sector in the region.
Table 1, based on the Annual Census of Employment, summarises retail employment changes in the South East and clearly shows the increasing importance of retailing employment in sheer numbers. In most counties growth in the number of retail jobs has been concentrated in the non-food sector, reflecting in part substantial real growth in non-food spending with food/ convenience per capita expenditure remaining virtually static in real terms. All counties in the region reveal significant growth in female part-time employment.
However, when one looks at full-time equivalent employment (FTE), Table 2 shows a substantial decline in employment in food retailing, most notably in London. Employment in the South East in non-food retailing increased by only 3% in the period 1971 to 1981.
Although non-food retail expenditure has grown substantially in the past 15 years, so retailers have become more efficient, employing a lower ratio of staff to sales. However, the figures are aggregated for the region and mask considerable differences at county level. This suggests that the net addition to retail employment makes sense as a figure only when aggregated at a regional level, even though there may be substantial local benefits.
It is arguable whether it is worth attempting to discern net employment gains in the context of a local economy because of the essential dynamism of the retail sector, which is characterised by a constant ebb and flow of consumer expenditure and affected by the rationalisation of retailers’ operations and their changing staff structures.
Against this background of declining employment in retailing generally and the difficulties in assessing employment impact, one might ask why we bother.
We do so because the arrival of any major new employer in a region is likely to have a substantial local impact.
Because of the particular employee profile of shopping centres, the employment impact on local labour markets will be more direct. Moreover, in the South of England, where available labour supply overall is substantially less than the North, care will be necessary to assess the relative benefits and non-benefits of any proposal in terms of employment.
Obviously, if there is a substantial pool of unemployed labour, or fast rates of growth in the economically active population, new job opportunities will be welcomed and the labour pool will probably be large enough to provide the type of employee most likely to undertake retail employment. However, if the local labour market is more constrained it will be necessary to examine carefully the total job requirements forecast in the structure plan period. This encompasses both the sorts of job likely to be needed in the plan period, the employees which will be available to fill vacancies and the typical profile of jobs which will probably be created. It has been argued that at county level data is too crude and the analysis should focus at local or district level. However, large new shopping centres, especially those located out of town, are typically in highly accessible locations and job opportunities need not, and will not, be restricted solely to the immediate surrounding areas.
Mismatch between job skills may be an issue in areas of lower unemployment, but it is important to remember that current problems may not be around when a new centre is eventually trading. In addition, retraining and education initiatives will continue to alleviate the problems caused by the national trend in changing from secondary to tertiary employment.
Further problems arise for the planner in differentiating between the relative employment effects of the leisure and shopping components of a typical new shopping centre being built today. And then, even if we do produce a broad level of direct employment generation, to this must be added the indirect and secondary employment generated. Indirect employment is that engaged in providing goods and services to activities directly related to the various uses within the development proper. Such employment is to be found in firms that supply goods and services to occupiers, eg cleaning services, office supplies, banking, security and transport facilities.
Secondary employment covers that which results from an increase in wages and the extra spending of direct and indirect employment resulting from the expenditure and service requirements of any immigrants in the area associated with the scheme. Also included is the extra spending arising from people working who were formerly economically inactive or unemployed. Although these multiplier effects of job creation are diffuse and difficult to quantify, and there is a dearth of empirical research in this field, they will nevertheless contribute to an overall employment-generation figure.
It is particularly important, therefore, to examine employment generation in detail. Simple gross figures can hide a myriad of problems or opportunities.
To assess properly the employment impact of a major new shopping centre it is essential to have a clear understanding of the local and regional retail employment scene. The main problem is the limitation of published and unpublished sources of information.
In the early 1970s central government decided to scrap the Census of Retail Distribution and to replace the decennial censuses with an annual inquiry, known as the Retail Inquiry, and a Register of Shops providing local-shop-based information similar to the census. However, government cost-cutting meant that the Register of Shops was never initiated, and the Retail Inquiry has suffered from so many changes to definitions and categorisation that it is almost worthless to retail planners. At present there is no readily available, locally based information on shops or shopping centres, or on turnover, floorspace or retail employment. The problem is aggravated, when examining major regional and subregional shopping centres, by the absence of any real precedent from which to draw inspiration. Indeed, the general debate over employment issues in the new “out-of-town” regional centres is virtually nil, while that concerning superstores is best described as thin.
Although information is scarce, the issue of employment generation and impact has arisen at a number of major recent planning inquiries.
In attempting to quantify the number of jobs likely to be generated by these schemes, the applicants have invariably adopted a comparative approach using the limited information on existing major free-standing shopping centres, namely Brent Cross and Metro Centre. Better information is becoming available from Meadowhall and Lakeside, Thurrock.
However, there are some inherent difficulties in this comparative approach, mostly related to the very different locational and economic circumstances of new centres. What the inquiries have shown is that it is difficult enough to trace past trends in retailing employment in selected localities, let alone to look forward to what might occur in the future.
On the retailer side new technology and new, more efficient, trading formats influence employment needs and the type of skills required. The consequence is that retailer employment needs and corporate policies towards new employment are continuously changing. It will be crucially important to monitor these trends.
It is clear that developers and their agents must be aware of the implications of their proposals either to capitalise on the employment benefits or, at worst, to mitigate undesirable employment side effects.
(1) Employment Perspectives and the Distributive Trades, NEDO, 1985.
