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Investing in the future of the South West’s economy

  • by JW

Mixed messages: business activity falls but firms remain optimistic [Devon Live]

Meanwhile: resorts try to maintain the visitor numbers “that formed both the basis for their economic prosperity and their identity”. [i-news]


Torbay Council says it is “doing all it can to revive the Bay’s fortunes and bring millions of pounds worth of extra spend back” – as reported on today’s Devon Live:

Torbay council officials say they are committed to improving life in Torquay and have a plan in place to bring millions of pounds worth of extra tourism spend to the resort after what traders say has been a lacklustre summer. It comes as figures show tourism numbers in Devon are down by as much as 20 per cent – with traders in the Bay fearing it’s been unusually quiet.

On the one hand, the question has been asked whether our local economy is dangerously over-exposed to tourism – especially with its traditional low wage seaside ethos, now struggling with overcrowding, second homes and a staffing crisis – the reality facing South West tourism, as reported earlier in the year.

On the other hand, there is the longer-term picture of Devon and Cornwall, and that we should “be careful what we wish for” – today’s faded seasides were once the UK’s hotspots. Perhaps, then, the likes of Torbay (and even Sidmouth?) need to be taking that longer view, as suggested by tourism writer Kathryn Ferry:

Many of our Victorian ancestors’ most beloved resorts have found it notoriously difficult to maintain the visitor numbers that formed both the basis for their economic prosperity and their identity.

Seaside resorts are, by definition, on the edge. People rarely just pass through. Cornwall’s location has made this a truism for most of its history. Thankfully for the county’s economy, tourists are willing to drive long distances or board packed trains to get there. Big influxes may put pressure on residents and local services, but on balance, it is better to thrive with their help than to fade away and be forgotten. After all, holiday fashions can quickly change.

Torbay is looking to the longer term with these latest plans – but it’s difficult to do so as a business if you’re in the middle of the ‘perfect storm’ as restaurants, holiday parks and hotels are struggling with the fallout from Brexit, Covid, living costs and energy bills, as reported last winter.

This winter is not looking much better for the local economy, as “work dries up for South West firms” amid rising interest rates and input costs, according to a new NatWest report:

Companies who took part in the study said clients had adopted a more cautious approach to spending as interest rates rose, while input cost inflation also rose to a six-month high. Business activity also fell across the UK as a whole, but the South West saw the most pronounced drop in sales of all 12 monitored regions.

And yet, the same report from NatWest is cause for optimism:

Despite this, South West firms remained optimistic, with the degree of positive sentiment improving to the highest in five months and exceeding the UK-wide average. Companies that anticipated output to increase generally linked this to hopes that economic conditions and consumer confidence would strengthen, while there were also reports of new marketing strategies and investment in new projects.