Growth of Scarborough Study - Scarborough Borough Council

4.6 Business base
4.6.1 Driven by Scarborough’s labour market and employment profile the Borough’s business
stock has a very high concentration of low value-adding businesses, with almost 40% of
local businesses in wholesale/retail and tourism industries. Another 42% of local
businesses are from sectors with low levels of employment locally. These include
agriculture, construction and business services/real estate. Additionally, other key
employment sectors including manufacturing, education and health account for only 7%
of local business stock. On a similar note, some 14 firms in Scarborough which employ
more than 200 individuals each account for as much as 15% of local employment. Such
trends highlight the dependence of local economy on fewer large scale employers.
Although growth of Scarborough’s business base is comparable to the regional rate, it is
much lower than the national average. Additionally, Scarborough has a lower incidence
of micro SMEs which have further witnessed a slower than average growth between
1998 and 2003.
Table 4-2: Change is Business Base (by employment size) between 1998 and 2003 (Source: York and North
Yorkshire Strategic Economic Assessment 2004)
Size Bands
Scarborough
Yorkshire and The
Humber
England
1-10 employees 3.5% 5.0% 8.5%
11-49 employees 22.7% 3.1% 4.3%
50-199 employees 0.0% 12.8% 10.9%
200 or more employees -17.6% 9.5% 4.1%
Total 5.9% 5.0% 8.0%
4.6.2 Below-average concentration of micro businesses in Scarborough suggests a poor level
of entrepreneurial culture in the Borough. In addition, business start-up rates for
Scarborough are lowest in the sub-region. A further rise in business closure rates in the
recent past has left the local economy performing poorly on the business formation front.
Poor infrastructure and an unattractive business environment to some extent can
account for Scarborough’s poor performance with regards to business formation.
Additionally, business creation in North Yorkshire can broadly be described as high
numbers of older entrepreneurs with an objective to generate sufficient income to meet
their expenditure, highlighting a significant drawback in the sub-region’s enterprise
culture which limits growth of the local economy.
4.6.3 On a different note, Scarborough’s peripheral location in terms of national rail and road
infrastructure is hindering its image as a business location. The closest motorway access
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