RSN Priority - A thriving rural economy

Businesses of all types, sizes and sectors should be supported to prosper, grow and provide decently paid employment opportunities. This will be of direct benefit to rural communities and will contribute significantly to the national economy.

  • There are 547,000 registered businesses based in rural areas (and probably as many microbusinesses again which are unregistered).
  • They are 24% of all the registered businesses in England, so form a vital part of the national and regional economies.
  • Those registered businesses have an annual turnover of £434 billion or £124,000 of turnover per person employed.
  • Productivity (Gross Value Added) in rural areas is £246 billion (2016 figure) or £44,740 per workforce job, which is below the England average (£50,270).
  • Rural economies are diverse, with businesses from across the range of sectors.
  • Landbased businesses (including farming) are important, but 85% of rural businesses are from other sectors. Other key sectors are professional services, retail and construction.
  • Most registered businesses in rural areas are small. Indeed, almost 18% of them have no employees, being sole traders or partnerships (more than double the equivalent urban figure). Some 84% of employees in rural areas work in SMEs.
  • Those registered rural businesses employ 3,500,000 people. This figure implies a significant outflow of people commuting to urban-based jobs. However, home working has grown and 22% of all rural jobs are home based (compared with 13% in urban areas).
  • Whilst the unemployment rate in rural areas is relatively low, many job opportunities are poorly paid, seasonal or insecure. Many have two or more part-time jobs to make ends meet. Median (average) annual earnings from rural employment are £21,400. This is 10% less than annual earnings in England as a whole (£23,700).

1 Sources are Defra and ONS. All figures in the Key facts section relate to 2017 unless otherwise stated.

Rural economies in different areas vary and some are closely integrated with urban centres.  The level of entrepreneurship within them all presents a policy opportunity, but there are significant challenges which should be addressed by a Rural Strategy. They are:

    • Reducing the productivity gap;
    • Helping rural businesses (especially SMEs) to grow locally;
    • Supporting further diversification, especially into high value-added sectors;
    • Sustaining high streets and their businesses in rural towns; and
    • Creating better paid and more secure jobs.
Click here to find out more about our priority areas, challenges to address and what steps may make a difference for rural communities

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