Figure 18 Greater Cambridge's economy
The success of the Greater Cambridge economy is of national importance. Greater Cambridge has grown as a centre for high technology employment since the 1970s, and is seen as a world leader in innovation, much of it as a result of ideas coming out of the University of Cambridge and new companies starting up and expanding.
However, our local economy is not just about technology. Other types of industry and agriculture also play an important role and ensure a variety of jobs for local people. Greater Cambridge is also a thriving education, retail, leisure and tourist destination, which all provide jobs. It is important that the city centre continues to provide a wide range of uses including shopping, leisure, entertainment, museums, university faculty buildings and colleges, offices and housing. There are also district and local centres in the city, and village centres at a range of scales, which meet more local needs, as well as providing valuable and varied employment. New town centres are being developed at Northstowe, and soon at the new town north of Waterbeach.
If we do not plan for enough jobs of the right types, this could lead to a range of consequences, including local firms not finding suitable affordable buildings for their needs, companies moving elsewhere (including outside the UK), and increased commuting out of the area. It could also mean not enough services and shopping in our area, forcing people to travel outside of Greater Cambridge.
The Councils have committed to a goal of doubling the total economic output of the Cambridgeshire and Peterborough area over 25 years (measured as Gross Value Added – GVA – which measures the value of goods and services produced in the area). This vision formed part of the devolution deal with government which created the Cambridgeshire and Peterborough Combined Authority. It has implications for future jobs and homes growth in our area.
The 2018 Cambridgeshire and Peterborough Independent Economic Review (CPIER) showed that our recent employment growth has been faster than previously forecast. It considered future scenarios regarding continuation of that growth, including those that achieve the goal to double GVA over 25 years.
The next Local Plan needs to identify the number and type of jobs that should be planned for, so that we can find appropriate sites for business growth. It will also be important to consider how the plan provides flexibility so that if this ambitious economic growth is achieved, it is accompanied by the homes and infrastructure to support it. The new research that we have commissioned will help us with this. For more detail on what this may mean for housing growth, see the Homes section.
24. How important do you think continuing economic growth is for the next Local Plan?
4.5.1 What do we have to do?
National planning policy places significant weight on the need to support economic growth and productivity, taking into account both local business needs, and opportunities for development that arise from outside the area.
Our Local Plan needs to provide a clear economic vision and strategy which positively and proactively encourages sustainable economic growth. This includes identifying sites to meet economic growth needs.
Plans should also support the continued vitality and viability of town centres, as well as supporting a prosperous rural economy.
4.5.2 What are we already doing?
The 2018 Cambridgeshire and Peterborough Independent Economic Review (CPIER) provided an important baseline of evidence about our local economy.
The Councils have commissioned their own research into jobs growth to inform the new Local Plan, drawing on evidence highlighted by the CPIER of recent fast employment growth. The study will also explore the supply and demand for employment land of different types.
Building on the CPIER, the Government and the Cambridgeshire and Peterborough Combined Authority recently published the Cambridgeshire and Peterborough Local Industrial Strategy. It aims to improve the long-term capacity for growth in Greater Cambridge by supporting the foundations of productivity, increasing sustainability, broadening the base of local economic growth including in the north of Cambridgeshire, and building on the clusters and networks that have enabled Cambridge to become a global leader in innovative growth.
The Councils, together with the Greater Cambridge Partnership and Combined Authority, are preparing an Economic Development Action Plan to deliver the priorities set out in the Local Industrial Strategy, as well the Councils' own more local economic ambitions.
The adopted 2018 Local Plans seek to support the continued success of the economy of the Greater Cambridge area. Through the allocation of sites and granting of planning permission there is a large supply (135 hectares) of employment land that continues to be developed. This includes developments in the centre of Cambridge around the station, and on the edges of Cambridge at the Cambridge Biomedical Campus and West Cambridge. There is also further capacity at a range of sites outside Cambridge, including Babraham Research Campus and Granta Park. New settlements like Northstowe will also include employment space.
Through the North East Cambridge Area Action Plan, we are exploring the potential for further development at Cambridge Science Park and around the new Cambridge North station to create an Innovation District, which will include homes, jobs, services and facilities. We consulted on options for this area in early 2019 and will be consulting on a draft plan in 2020.
Beyond the identified growth sites, our adopted 2018 Local Plans support continued employment growth in appropriate locations. They also seek to protect important existing employment spaces from competing uses, including industrial land in Cambridge, and employment sites in villages.
4.5.3 What are the key issues?
Space for businesses to grow
The Local Plan needs to ensure that there is sufficient land for business uses, in the right places and to suit different business types and specific business clusters. Greater Cambridge employers come in a range of sizes, from start-ups with a few individuals to major firms with hundreds of employees, and the area needs to have the right range of premises to support these varied needs. Alongside this, more and more people are working flexibly, and do not need to travel to a specific place of work on a daily basis. We need to consider:
- Demand for 'start-up', incubator, and grow-on space as a feature of Greater Cambridge's economy is a high rate of 'Business churn', with large numbers of firms starting up each year.
- The increasing popularity of flexible workspace and co-working hubs, providing shared facilities.
- Providing for a wide range of employment opportunities.
- How new business space can adapt to fast-changing working practices which will continue to evolve over time.
- Demand for specialist space, such as laboratories.
25. What kind of business and industrial space do you think is most needed in the area?
Protecting existing employment land
Local residents are concerned about protecting existing business sites. Industry, such as manufacturing, is an important part of the local economy but there is pressure from competing higher value land uses, particularly in Cambridge. We will need to consider:
- The future need for employment space, including for industry.
- How effective our current policies have been, in protecting employment land, in particular, industrial land in Cambridge and employment land in villages from being redeveloped for other uses where not allocated for other uses in the plan.
- Which key existing sites should be specifically safeguarded.
26. Do you think we should be protecting existing business and industrial space?
Creating a range of jobs
Whilst we are proud of the success of Cambridge's high technology businesses, there are parts of Greater Cambridge where people do not perceive the opportunities as being for them. This includes areas adjoining some of our most successful business parks. Supporting different kinds of business, which create a varied range of jobs, is important so that everyone can benefit from economic growth. Through the preparation of the next Local Plan we will explore how we can:
- Support a range of businesses to be successful in this area, providing a range of job types and at a range of different skills levels.
- Ensure that there is sufficient appropriate business space for the supply chain of other firms which support the high technology sector.
27. How should we balance supporting our knowledge-intensive sectors, with creating a wide range of different jobs? What kind of jobs would you like to see created in the area?
Where jobs are created
A feature of the Greater Cambridge economy is the range of businesses located at South Cambridgeshire villages, in both small premises and business parks or industrial estates. These complement the employers based in or on the edge of Cambridge, or the large business parks in South Cambridgeshire. We will need to consider:
- Where new business space should be sited, in relation to public transport and residential areas, given that we have a highly mobile workforce who tend to move jobs much more frequently than they move house.
- How we ensure that our new settlements are attractive to major employers.
- Whether and how we should plan for new business space, or flexible co-working space, in neighbourhoods or villages, thereby reducing the need to travel, and supporting our net zero carbon aspirations.
28. In providing for a range of employment space, are there particular locations we should be focusing on? Are there specific locations important for different types of business or industry?
How our city, town and village centres evolve and adapt
Cambridge city centre, and our district, local and village centres, provide important services and a large amount of retail space. These already make an important contribution to the vibrant and diverse character of Cambridge and its charm as a place to inhabit and visit. It is therefore essential that these facilities are given careful consideration with regard to any related development proposals that may affect their provision. Similarly, it is important that residents of new urban extensions/towns and other rural villages/centres also have access to local services and facilities to meet their day-to-day needs.
Retail is changing with the growth of internet shopping, and centres need to adapt if they are to remain vibrant destinations. The Local Plan will need to consider:
- How our town centres adapt to the change in retail and the growth of online shopping.
- What other uses, such as leisure, culture, workspace or homes, should be encouraged in our centres.
- If and where shops should continue to be protected from competing uses unless they are shown to be no longer viable.
- How to improve the public realm in centres to allow a variety of local activities.
- Ensuring well located, suitable local services and facilities available to meet the day-to-day needs of residents and visitors.
29. How flexible should we be about the uses we allow in our city, town, district, local and village centres?
Managing the visitor economy
Cambridge is a major tourism location, which brings opportunities and challenges. In recent years, several new hotels have been built in the area with more proposed in the centre of Cambridge. These developments will support the continued vitality of the city centre, encouraging place-making investment and local job creation. However, it is important that Greater Cambridge is able to capture and spread the economic benefits of the tourist sector in a sustainable manner.
The Local Plan will need to consider:
- Where new visitor accommodation should be allowed, not just in the city centre but in urban and rural locations, including the approach in residential areas.
- The impact of different forms of accommodation including short term lettings such as Airbnb.
- How we support business diversification while also recognising potential impacts on residents and other businesses as well as the historic environment.
30. What approach should the next plan take to supporting or managing tourism in Cambridge and the rural area?
 Economically Active % Unemployment - Kings Hedges 4.8% (near Cambridge Science Park), Newnham, Castle 0.9%, Cambridge 2.7% in 2011 (source: Census 2011 - Cambridge Insight)