News

Mixed picture for region’s jobs,

(16 February 2005)

The region’s drive to develop tourism is paying off in new jobs, according to research from Durham Business School.

The School, which monitors job and business creations, expansions, closures and contractions on a quarterly basis, reports that an extra 400 jobs were created in the sector in the period October to December 2004.

The survey comes in the wake of a new regional strategy by One NorthEast to bring two million more visitors to the region and further bolster the North East economy..

While the School’s researchers noted four main new business start-ups within tourism, the majority of jobs (250+) came from just one new venture - the development of a new casino within The Gate leisure complex in Newcastle..

Durham Business School’s survey also highlights good news for the Tees Valley area, which outperformed the other sub-regions in terms of job creation. .

Tees Valley was responsible for nearly half of the total jobs recorded within the wider region. In total, the area benefited from the creation of 1,300 new jobs. Many came from the expansion of existing businesses, including 200 new jobs at PD Ports and 100 at Taylor Woodrow. .

In part, the area’s success this quarter has been achieved against a sharp deterioration in job creation in Tyne & Wear. Here, the total number of new jobs created was substantially lower than in previous quarters, and for the first time in two years, Tyne & Wear experienced a net loss of jobs (-230), following a number of major closures and contractions. .

Tyne & Wear’s experiences in the final three months of 2004 were reflected in the overall figures, with the region witnessing a downturn in the overall number of jobs created. In total just 700 new jobs* were recorded, against more than 4000 across each of the last two quarters..

The Durham Business School research highlights that the somewhat subdued performance of the local economy is seen in modest growth in the usually dynamic retail (+250) and call centres (+200) sectors. Both have typically contributed a net gain of around 1,000 jobs in previous quarters. Of the gains made within the call centre sector, 150 new jobs were recorded at Garlands in Hartlepool..

The region’s manufacturing sector followed the national trends highlighted in recent CBI reports, losing in the order of 600 jobs. .

Commenting on the survey findings, Professor Ian Stone of Durham Business School said: “The boost to jobs in the tourism sector is excellent news for the region and, given the ambitious plans for its development over the coming years, we would hope to see this growth replicated in future surveys. “The overall fall in new jobs created and business expansions does, however, suggest a slight reduction in business confidence in the region. At this stage it is too early to say whether there might be a longer-term downturn in the regional economy. The next quarter’s figures will give us a better indication of where we are heading. .

“Looking back over the past two years we can see that a similar dip occurred in early 2003 but this righted itself quite quickly. "Nationally the picture is positive and that should give us cause for optimism. The economy remains relatively buoyant and there are clear opportunities to reduce interest rates, which would further benefit business. As we are also in an election year, one would expect the government to keep the pressure on to ensure the economy keeps moving and growing.”.

The quarterly study is compiled by Durham Business School on behalf of regional development agency, One NorthEast. Commenting on the research findings,Alan Clarke One NorthEast Chief Executive said: “This survey brings yet more encouragement to the region's tourism industry in a week when the North East led the national news agenda playing host to the Labour Party's Spring Conference at the Sage, Gateshead, and following on from the launch of a major new tourism plan with £20m worth of One NorthEast funding behind it over the next three years.

"The recent announcement of 200 new jobs at Nissan to work on its new P32L model and 700 additional posts to be created at Asda's new Washington distribution centre will go some way to boosting next quarter's job creation figures, but this backdrop of good news does notmean taht we can becpme complacement in any way about the region's economic future and the challenges it faces".

Durham Business School's research is based on its NEWSBase system, which monitors local media announcements and other regional intelligence. It is unique in the UK and covers expansions, contractions, openings and closures in the region. .

NEWSBase was designed by Durham Business School to provide regional policy-makers and practitioners with up-to-date information on changes within the various industrial sectors, enabling the region to tackle potential problems early on..

Issued on behalf of Durham Business School by Bradley O’Mahoney Public Relations. For press enquiries, contact Clare Maxwell on 0191 281 8833 or email claremaxwell@bradleyomahoney.co.uk

Note to editors: * The figure of 700 new jobs across the region is the net figure created – i.e. by taking away jobs lost through business closures and contractions from the overall number of jobs created through new businesses and expansions in existing businesses.

Recent figures from One NorthEast estimate that there are currently 47,000 jobs which are directly supported by tourism and a further 52,000 indirectly. (Will get this double checked by RDA!)