New research shows thriving community businesses provide economic and social boost despite the pandemic

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Community Business Market in 2021 report shows thriving sector provides economic and social boost despite the pandemic.

While many businesses have struggled during the pandemic, new research shows that the resilient community business sector has reported increased demand for services in response to COVID-19 and adapted their offer to meet this demand.

The annual Community Business Market Report for Power to Change by independent social research company CFE Research, showed that the median total annual income of community businesses increased to £130,000 this year (an increase of £20,000). The report also showed that these businesses have responded to the pandemic by evolving their services to meet their community’s needs: three-quarters (76%) now offer more than one service to their community – a rise of 13 percentage points.

Community businesses are businesses run by local people and they trade for the benefit of the community to which they are accountable. They make positive impacts in their community and exist to help make places better. The pandemic caused a marked increase in demand for their services, particularly for wellbeing services. Three quarters (75%) of community businesses offering food provision saw demand rise, 80% saw a rise in demand for their financial advice, 78% for their health and social care services and 88% for mental health support. Two-thirds (66%) of community business now expect to develop new partnerships or collaborations in the coming year to deliver goods and services.

Community businesses are focal points for communities, as well as trading entities. Nearly all community businesses surveyed say they positively impact the lives of local people, which helps explain why local people valued them during the pandemic and why they were resilient to economic shocks. The outcomes on which the most community businesses made an impact were reducing social isolation (95%), improving health and wellbeing (95%), increasing community cohesion (97%) and increasing community pride and empowerment (95%).

Community businesses also offer important routes into employment. Three in five (58%) said they had employed at least one person in the last year who had never been in paid employment before.

Vidhya Alakeson, CEO of Power to Change, said: “The report shows how remarkably resilient the community business sector has been over the past year. It was quick to respond to the challenges of the pandemic and these businesses used their deep understanding of local circumstances to meet the needs of their communities.

As we look to the future, it’s clear that community businesses can play a major role in tackling the issues we all face, from COVID-19, to declining high streets, to the climate crisis. It’s time for government to look more closely at a community-led approach to solving these any many other challenges.”

At a time when many high street buildings are standing empty, they provide the optimal location for commercial and community activities for community businesses. The report showed that one in five (22%) businesses surveyed is expected to make use of vacant buildings within the next 12 months.

The report also found that community businesses are actively responding to climate change. Seven in 10 (72%) said they had some impact on improving their local environment in four main areas: food growing and provision (40%); improving buildings (37%); improving or protecting the natural environment (37%); managing waste/resources (32%).

This is the seventh in a series of annual reports published by Power to Change on the state of the community business market.

The report includes comments from community businesses, highlighting their experiences over the last year:

“We’ve emerged with more members of staff than when we went in and more projects underway and just a clear sense of who we are and what we’re doing and why we are doing it, which I don’t think we’d have had if it hadn’t been for [the pandemic].” | Arts centre

“We’ve seen a greater interest in our services … some things like our holiday forest schools which came back last summer. The interest has just leapt, we’re selling places [really] quickly.” | Training and education centre

“Our organisation in the city has grown and we also, at the same time, secured contracts with the council to do cycle training and these things called Bike Doctors.” | Community hub

Read the full report here.