Community businesses form £1bn beating heart of local areas

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New research shows community businesses have been vital rallying points for villages, towns and cities, promoting public health, reducing social isolation and improving community cohesion during the Covid-19 pandemic.

The annual Community Business Market Report for Power to Change by independent social research company CFE Research, shows the scale of the community business sector which is worth almost £1bn in the UK and provides employment for more than 37,000 people.

The report showed that:

  • 9 out of 10 community businesses adapted or changed services in response to the pandemic, with nearly half (46%) providing remote services and nearly three quarters (73%) identifying new business opportunities in response
  • Before the advent of the pandemic, an estimated 11,300 community businesses operated in England – twice as many as there were estimated 6 years ago
  • A quarter (25%) of businesses reported an increase in trading during the initial stages of the pandemic last year. These were mostly shops and businesses in rural areas
  • 72% of paid staff at community businesses work part time, an increase of 9 percentage points since 2019 and representing a longer-term, three-year trend
  • Only 1% of these businesses, surveyed during the first national lockdown, had ceased operating and did not anticipate reopening.

At a time when communities are rapidly losing shared community spaces, due in part to the impact of the Covid-19 pandemic on our high streets, community businesses are leading the way in acting as focal points for local communities. According to the annual Community Business Market Report nearly half of the community business sector is comprised of community focal points which are helping to anchor communities, increasing resilience, connections and cohesion.

These focal points account for around a third of the market’s total income and staff numbers. They provide places where people can seek support, get active, increase ties with their neighbours and communities, as well as creating all-important employment and business opportunities, enabling investment, income and profits to stay within their communities. Community focal points are a crucial aid in reviving places such as town centres, making places look and feel better and helping local people to more optimistic.

Community businesses such as the Heeley Development Trust, Sheffield, have been building up community resilience in their local area over a number of years, which has helped their community weather the pandemic. The Trust owns and manages a number of community-owned spaces and manages a community bike shop, A Different Gear. At the beginning of the Covid-19 pandemic they were able to pivot their business, offering A Different Gear’s fleet of e-bikes out to key workers to ensure they could get to work safely. They also used the connections they’ve built through health and well-being projects that operate in their buildings to help manage their local vaccine roll-out.

Vidhya Alakeson, CEO of Power to Change, commented:

“There has been a gradual loss of shared community spaces in recent decades and as the long-term impacts of the Covid-19 pandemic continue to unfold, there is real risk this decline will be exacerbated. There’s growing recognition among both the public and national and local leaders that the loss of community spaces is one of our most pressing issues, but any response needs to be built in partnership with local people. The Community Business Market report highlights how community business can fill the void left behind. Whether a bike repair shop, a pub or a service offering support with managing mental health, community businesses bring local people together and deliver what local places need. They are fast becoming the beating heart of our local communities.”