The socio-economic impact of businesses in the railway arches
Table 5.2 – Estimated business rates generated each year by property within The Arch Company portfolio compared to total spending power of local authorities
Business rates generated by the portfolio
Business rates retained by local authority
Retained business rates as a % of local authority core spending power
Local Authority
Southwark
£7.8m
£2.3m
0.6%
Lambeth
£5.9m
£1.8m
0.5%
Tower Hamlets
£3.4m
£1.0m
0.3%
Wandsworth
£2.1m
£0.6m
0.3%
Manchester
£0.6m
£0.6m
0.1%
Hackney
£1.4m
£0.4m
0.1%
Source: Volterra estimates, 2023; Department for Levelling up, Housing and Communities, 2022. Core spending power: provisional local government finance settlement 2023 to 2024.
Indirect and induced economic effects
Note on methodology
1.1
It should be noted that gross, and not net, impacts are presented in this section as displacement is not considered within this study. In other words, the calculations in this section do not account for the likelihood that economic activity directly supported by The Arch Company would displace economic activity elsewhere to some degree. Displacement is not considered as the wide range of types and locations of businesses within The Arch Company portfolio make it difficult to accurately determine the level of displacement across the portfolio. The displacement rate will also vary dependent on the geography or study area being assessed.
Worker expenditure
5.9
Indirect and induced effects result from the knock-on activities of the organisations located in The Arch Company portfolio off-site. The most common framework for understanding these effects groups them into supply chain (or indirect) effects, associated with the products bought and businesses supported by The Arch Company occupants, and income and expenditure (or induced) effects, associated with the increased income and expenditure of workers. Worker expenditure is often one of the most significant impacts of development and economic activity for local communities. In general, worker expenditure is spent in proximity to places of work, and therefore has impacts within the local economy. A recent GLA study estimated that office workers in London spent on average £13 a day in the local area around their place of work. 45 By adjusting this figure for the differences in pay between industries and regions, and applying it to the direct jobs supported within The Arch Company Portfolio, it is estimated that the 25,600 FTEs currently estimated to be located in The Arch Company spaces would support a total of £47.4m in worker expenditure each year in the local areas surrounding their places of work.
5.10
5.11
45 GLA, 2021. Lost worker vs. tourism expenditure in the Central Activities Zone (CAZ) during the COVID-19 Pandemic
23
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