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Under the Radar

Tracking and Supporting Rural Home-based Business

How do people earn a living in rural areas, now that only 4% of the rural population work in agriculture?

A new report for the UK Commission for Rural Communities (a division of the Countryside Agency) sets about exploding some of the myths and poses some challenges about the rural economy in the 21st century.

The focus of the report, Under the Radar, is on home-based businesses which form a potentially dynamic but unsung Cinderella sector creating wealth and employment in rural areas.

The two key questions posed by the report are:

  • Why does the value of this sector go largely unrecognised by business support agencies and policy makers?
  • What should public authorities at every level do to respond and how can they maximise the potential?

Homeworking more common in rural areas

One of the particular strengths of this report is that it is strongly evidence-based.  A huge amount of evidence has been marshalled from official and other sources, to present a convincing picture of the strength of the homeworking economy.

Amongst the data pulled together by the authors are the following:

  • Home-based working in the UK had risen to almost 3.3 million in the Spring of 2004, according to Labour Market Trends. 
  • 766,000 people work from home in the 145 English rural districts (the focus of the report)
  • This 11.6% of the rural workforce working from home compares to 8% of the urban workforce
  • 56% of self-employed people are home-based
  • Nationally, 39% of small businesses are home-based.  in rural areas it is 55%
  • 60% of rural homeworkers are men, 40% women

The map above shows the distribution of rural districts with above average levels of homeworking.  It is particularly strong in the South-West and parts of the North-East region - the more remote areas.  In some communities in these areas over 20% of the workforce may be running a home-based enterprise or two.

What are home-based workers doing?

The nature of homeworking has changed radically over the course of the last century.  Most people who worked at home at the time of the 1901 Census were women engaged in dressmaking and laundry work. 

There remains a minority of low-paid homeworking jobs.  But over the past 15 years or so the availability of new technologies has transformed the nature of home-based work, not least in rural areas.  This takes two forms:

  • New economy jobs dependent on the new ICT, where skilled professional or lower-skilled data processing is carried out from remote locations
  • More traditional occupations can become more viable as business start-ups as the new technologies are used to overcome distance, so for example craft products can reach a far greater market, or customers can be enticed to come from afar.

In around 50% of cases, according to the report, home-based businesses are started up by incomers to rural areas, something that the authors feel should be encouraged and supported.

Many people are running more than one business enterprise, and many also combine part-time employment with self-employment.

What is the impact of home based business in rural areas?

Rural England has faced many challenges over the past 20 years.  Thousands of post offices, villages shops and pubs have closed, leaving many communities without local services.  The growth of home-based working can help to recreate local economies, and revitalise dormitory towns and villages.

The authors also point out the "sustainable communities impact".  Potential benefits of home-based work include:

  • use of one property not two (i.e. for home and work)
  • less need to build new workspace to accommodate employment growth
  • village and town centre renaissance
  • reduction in commuting travel
  • increased security - more homes occupied during the daytime
  • an enhanced role for market towns providing 'hub' facilities.

So what should be done?

At the moment this growth in home-based enterprise is slipping "under the radar".  There is a plethora of agencies with fingers in the pie of rurality and economic development, but there is little evidence of anyone getting to grips with the issues.  As the report says:

"What is rare is any cross-theme thinking that sees the success of home-based business as being good for wealth creation as well as for the community and the environment.  Put simply, planning and economic development departments are not doing enough to connect the two issues together and work at supporting the new home-based working sector".

The business support agencies come under fire from many of the interviewees in the report, as well as from the authors.  Most of the support available is jargon-ridden, bureaucratic and is geared to growth and expansion models rather than sole entrepreneurs.

Networking models, however are held up as examples of good practice - where public money supports self-help networks and hubs where home-based workers can network and have access to facilities.

The report has many suggestions for public policy responses: for central government, Regional Development Agencies and local authorities as well as Business Links.

The recommendations include:

  • gathering evidence about local home-based businesses and their needs
  • supporting networking and hub initiatives
  • encourage the in-migration of high earners
  • support mentoring initiatives
  • simplify the processes of applying for funding.

And above all, home-based business in rural areas needs to com onto the radar.


Further information

Under the Radar - tracking and supporting rural home-based business, by Tim Dwelly, Kath Maguire and Frances Truscott, is available from the Live/Work Network, price 20.

Flexibility assessment:  Highly recommended reading for anyone involved in rural affairs, economic development and planning.




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