Economic impact assessment outline: rural employment scheme

An economic impact assessment supporting a rural employment scheme is read by one person for one purpose. The case officer wants to know how much weight the economic benefits can carry in the planning balance, and whether the numbers will survive a challenge at committee or appeal.

That means the document is judged on its assumptions rather than its conclusions. Eight sections, each short, each stating what it assumed and where the figure came from, will do more for a scheme than thirty pages of narrative about the rural economy.

Baseline economic context

Open with the study area and say why you chose it. A travel to work area, a district, or a defined rural hinterland each produce different baselines, and an unexplained study area invites the suspicion that it was picked to suit the answer.

Then set out the baseline from published sources. Employment by sector, the claimant count, economic activity rates and the local business stock are all available from national statistics at small geography, and each figure should carry its source and its date.

Keep it short. Three or four paragraphs and one table is enough. An assessment that spends six pages describing the local economy before mentioning the proposal has lost the officer before the argument starts.

Where local plan evidence exists, use it. Quoting the authority's own employment land study back to it is more persuasive than an independent estimate that points the same way.

Scheme description and floorspace

State what is being built, in the units the rest of the assessment uses.

Gross internal floorspace by use, the phasing, the expected occupier profile and the tenure. Where the end user is unknown, say so and describe the range of uses the permission would allow, because the employment estimate depends on it.

This section is also where you define what is existing and what is additional. A barn conversion that relocates an existing business from a nearby unit delivers very different net benefits from one that accommodates a new enterprise, and the distinction has to be made here rather than buried later. The design case for that kind of reuse usually sits alongside it in the design and access statement for a barn conversion.

Construction phase effects

Construction employment is real, temporary and frequently overstated.

Express it as person-years rather than jobs, which is both more accurate and less open to attack. Derive it from the capital cost or the floorspace using a published ratio, and name the ratio and its source rather than presenting a bare number.

Then be honest about where that employment lands. On a small rural scheme the contractor may be local, in which case the local effect is genuine, or may not be, in which case most of the wage spend leaves the area. Saying so costs you very little and buys credibility for the operational figures, which matter more.

Include the supply chain spend separately if you can evidence it, and leave it out if you cannot.

Operational employment estimates

This is the number the officer will remember, so it has to be defensible.

Work from floorspace to jobs using published employment density guidance, applying the density appropriate to the specific use rather than a general average. State the density used, the source, and the resulting full-time equivalent figure.

Then convert gross jobs into net additional jobs. The standard approach adjusts for leakage, the proportion of jobs taken by people outside the study area, displacement, the extent to which the activity takes work from existing local businesses, and multiplier effects through the supply chain and wage spending.

Use the published appraisal guidance for the adjustment ratios and cite it. An assessment that applies a multiplier without a source is the first thing an objector's consultant will attack.

Local supply chain and spending

Describe the expenditure flows the operation creates, and distinguish between those that stay local and those that do not.

For a rural employment scheme the credible local effects are usually procurement of services, use of local contractors for maintenance, and household spending by employees living nearby. The less credible ones are the ones that assume a national supply chain behaves locally.

Where the occupier is known and willing, a short statement from them about current local purchasing is stronger evidence than any modelled figure.

Avoid converting every flow into a headline spending total. A large gross expenditure figure with no local retention analysis behind it reads as promotional material, and officers have learned to discount it.

Effects on existing businesses

Officers will ask whether the scheme supports the rural economy or simply moves it around.

Address displacement directly. If the proposal competes with existing units in the area, say what the local vacancy position is and where that evidence comes from. If it complements them, explain the mechanism, whether that is a service local businesses currently buy from further away or a facility that keeps expenditure in the area.

Where the local plan protects employment land, or where the scheme involves the loss of an existing employment use, the argument connects to the wider evidence base and an employment land assessment may be the better vehicle for that part of the case.

Assumptions and their limitations

Give this its own section rather than scattering caveats through the text.

List every assumption with its source and date: the study area, the employment densities, the additionality ratios, the construction ratio, the occupier profile and the phasing. Then state the sensitivity, showing what the net figure becomes under a less favourable assumption.

A sensitivity range is a strength, not a weakness. An officer given a range of net additional jobs with a clear central case can attach weight to the lower end with confidence. An officer given a single confident number has to decide whether to believe it, and if they do not, they discount the whole document.

Presenting the case in the planning balance

Finish with a short section written for the officer report, stating the net additional employment, the timescale over which it arrives, the confidence level and any mechanism that secures it.

That last point is worth attention. Economic benefits that depend on a particular occupier can be secured, to a degree, through a local employment and training obligation or through conditions on the use. Benefits that cannot be secured at all still count, but they carry less weight, and it is better to acknowledge that than to have it pointed out.

Carry the conclusion into the planning statement as well, in two or three sentences, because that is the document the recommendation is built from. The full structure of the report is set out on the economic impact assessment page.

This is general guidance, not legal advice. Appraisal guidance, employment densities and local policy change, so check the current sources with your local planning authority or a qualified professional before relying on them.

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