Cornwall’s marine sector set for growth despite challenges

1st July, 2017

Cornwall’s coastline spans over 400 miles and no place in the county is more than 20 miles from the coast.  Therefore, it is unsurprising that the marine industry plays such an important role in our economic development and wellbeing.

The people of Cornwall have depended upon the sea for centuries.  The coastline, sea and waterways have long been recognised as a unique part of the county’s cultural and historical heritage.

Cornwall even has its own Maritime Strategy.  It was developed by Cornwall Council and covers the period from 2012 to 2030.  It considers traditional areas such as fishing, shipping, industry and transportation, alongside newer areas, such as marine technology and energy creation.

Not only does the marine sector bring thousands of skilled jobs to the county, it also brings an exciting source of innovation.  Recent years have seen developments in marine technology, wave energy and tidal energy, amongst other exciting projects.

What Types of Business can be found within Cornwall’s Marine Sector?

Much like the rest of Cornwall, the sector contains a disproportionate number of SMEs.  Propel Cornwall recently reported that there are 707 marine-related SMEs based within Cornwall and the Isles of Scilly LEP.  This is believed to make up 99% of local marine businesses.  It is predicted that this number will increase in upcoming years following investment and ongoing support from a range of sources, including national government, the EU and the private sector.

There are also a range of larger organisations based within Cornwall, including Pendennis Super Yachts and the Wave Hub.  Each of these contributes significantly to employment within the region.  Pendennis Super Yachts was recently recognised as national apprenticeship provider of the year.

Propel Cornwall is an initiative of the well-established Cornwall Marine Network.  It was launched in 2016 and seeks to support new marine businesses in improving skills, productivity, outputs and turnover.

Does the Marine Sector contribute to Local Employment?

The marine sector is recognised as a key component of the local employment market.  There are a wide range of estimates relating to the number of people employed within Cornwall’s marine industry.

Propel Cornwall reported that there were 12 500 people employed within SMEs in Cornwall’s marine sector.  They also reported that this equates to an impressive 1 in 7 marine jobs in the UK.  This compares to 2012 when the Cornwall Maritime Strategy noted that the industry supported over 14 000 jobs and creates £500 million of Cornwall’s GDP.

These figures are expected to increase in the next few years following the development of a new marine enterprise zone and the associated benefits that this should bring.

The ongoing development of the marine technology sector will increase the number of skilled jobs within Cornwall and could act as an incentive for skilled or educated young people to remain or return to the county, instead of feeling forced to move away in order to ‘make the most’ of their qualifications and experience.

Eurostat recently reported that the average salary in Cornwall is estimated to be £14 300.  This compares to an average of £71 000 in London.  Therefore, it is likely that many of us will be hoping that the development of the marine technology sector will provide well-paid job opportunities for the area.

How does the Marine Industry Support Wealth Creation in Cornwall and the UK?

The marine industry in Cornwall contributes to wealth creation both within the county and nationally.  Cornwall Council recently estimated that marine businesses generate 8% of the UK marine industry turnover.  British Marine estimated that industry revenue was £2.97 billion from 2014-2016, so this is a significant amount of wealth for the county.  Furthermore, the industry is predicted to grow over the next few years.  British Marine predict that this growth will be driven by domestic consumer markets, which is good news for local businesses concerned about the impact of the UK’s departure from the EU.

Cornwall Marine Network reported that just under 1% of the global marine leisure industry is based in Cornwall.  Interestingly, they also noted that Cornwall hosts 35 000 – 45 000 visiting yacht nights per year and that the county has over 5000 moorings, alongside thousands of boat owners!

The benefits are not limited to those working directly within the industry either.  It is important to remember that the marine sector also indirectly supports businesses that we may not typically associate with this area.

Over 5 million tourists visit Cornwall each year.  Many of these people are likely to be attracted to the county’s coastline, including the coast path, boat tours or days at the beach.  This means that hotels, shops, restaurants, surf schools and others also depend on the marine sector to help them generate the £2 billion per year, 28 000 jobs and 14% of all employment that tourism brings to Cornwall.

Challenges for the Marine Sector in Cornwall…

Many high-profile marine projects in the county have received EU funding.  These include the Cornwall Marine Network; Marine Hub Cornwall; MERiFIC, which seeks to enhance the adoption of marine technology; the Wave Hub; the CETO wave energy project; the Marine-I fund and developments at Hayle Business Park, amongst others.

This underlines the importance of the role of the UK government in the provision of support to the marine sector following Brexit.

An associated challenge relates to Cornwall’s Marine Strategy, which is focused upon the period between 2012 and 2030.  This comprehensive strategy takes into account a great deal of EU law and EU funding.  As a result, it is likely that this strategy will need to be reviewed as a result of Brexit.  This uncertainty will impact upon local marine businesses over the short-term.

Despite this, it is commonly argued that localism provides communities with the opportunity to exercise greater control over their local area, so many will be pleased that they get to have a say over what happens within the industry.

There is considerable debate and speculation over what may happen to current EU fishing quotas after the UK leaves the EU.

Triumphs and Opportunities for the Marine Sector in Cornwall…

National government has recognised the longstanding importance of the marine industry in the South West.  As a result, it was the first area to be designated as a Marine Energy Park.  Cornwall is also the site for the Marine Hub enterprise zone, which was announced in March 2016.  The government is investing £15 million in this zone, which spans Hayle, Falmouth and Tolvaddon.  It is hoped that this will enable the county to become a world leader in marine technology development.

Local marine businesses can receive support with funding, infrastructure development, research and supply chain management.  Funding support includes 100% business rate relief for up to 5 years, access to the Marine-i Challenge fund of £3.19 million, the BIG 2 £3.6 million investment fund to encourage business growth and more besides.  It will be interesting to see how this enhances economic development within the county and whether it will prove to be a success.

Innovative projects, such as the Wave Hub, continue to provide opportunities for skilled employment within the county.  This project is also attracting international businesses to the area, including American wave energy developer, GWave, who are running a large project from the site.

It is predicted that the Wave Hub will generate over £76 million for the region within the next 25 years and at least 170 jobs.

Many, including Maritime UK, hope that Brexit will provide new opportunities for international trade outside of the EU.  They argue that the industry will play a key role in proving that Britain is ‘open for business’.  Similarly, many within the local fishing community are hoping that leaving the EU will provide the opportunities for Theresa May to re-negotiate fishing quotas impacting upon Cornish fishing.

Research from in December 2016 showed that Cornwall is benefitting from the ongoing staycation boom.  They found that 76% of British people had planned a 2017 staycation and that 1 in 5 were heading to Cornwall.  Given ongoing safety concerns and a difficult exchange rate, this is unsurprising.  Many within Cornwall’s marine industry are seeking to benefit from this opportunity, including surf schools, boating companies and more.

In sum, the Cornish marine sector hosts a diverse yet impressive range of businesses.  It has continued to grow and evolve in the face of continuing challenges.  Brexit is likely to add to this uncertainty, but history has shown that Cornwall’s marine industry can survive and even thrive throughout challenging times.

Our research shows that innovation in areas such as marine technology, wave energy and tidal energy are likely to provide a valuable source of skilled employment and growth in the next few years.  This is good news as it enables people and businesses in Cornwall to draw upon the area’s distinctive cultural and historical heritage, in addition to supporting the local economy and proving that Cornwall can compete in an international setting.

This article was produced for and published in the June 2017 edition of Business Cornwall magazine.

Feature image by Jonathan Smith on Unsplash