Why do we need to build more houses?
Partly, because the Government says so, but partly, because there is a demand for more housing that needs to be met.
Futures Forum: How to sell the Greater Exeter Strategic Plan and its 2,661 new homes a year > offer a 20,000-capacity sports stadium
The East Devon Watch blog has just put together a very convincing counter answer:
ARE THE WHEELS FALLING OFF THE EAST DEVON GROWTH WAGON?
30 January 2019
This is necessarily a somewhat technical summary of why Owl thinks EDDC has got its recent past and future jobs and housing numbers terribly wrong, and attempts to pinpoint why this is. If the assumptions below are correct East Devon cannot hope to match new jobs to housing number increases and hence to aspirational growth figures.
It has huge implications for the district – not least Cranbrook and Axminster, where huge housing growth does not appear to correlate with very modest job growth.
CURRENT STATISTICAL TREND 258 JOBS/YEAR
EDDC’s 2015 aspiration 950 jobs/year
EDDC’s “Jobs-led policy on scenario” 549 jobs/year
Ash Futures (Experian) “Upper end” 309 jobs/year
Ash Futures “more likely” scenario 200-234 jobs/year
Evidence from the first set of job growth statistics published by EDDC since the adoption of the local Plan are running at less than half the number used to justify the housing development target. This is only one quarter of EDDC’s aspiration to create one job per new household or 950/year.
A “Jobs-led Policy On” aggressive growth strategy lies at the heart of EDDC’s Local Plan for 2013 to 2031.
Consultants were employed to create a number of scenarios forecasting growth in jobs. They ranged from 162-191 jobs/year for forecasts based on past trends to a top estimate for above average “jobs led” growth of 309 jobs/year. This top estimate would justify a housing target of 13,050 for the period.
One of these consultants, Ash Futures, gave cogent arguments as to why this figure, in their opinion, lay at the upper end of likely growth and proposed a more modest, more realistic, set of growth assumptions generating 200-234 jobs/year. This more likely scenario was never converted from a jobs forecast to a housing assessment but it would have been just a bit higher than the 10,512 figure based on past trends. All these forecasts took account of demographic changes, migration into the region and economic growth.
Ignoring this, EDDC decided to add a further 240 jobs/year to the upper end 309 figure in a new “policy on” scenario to provide a total forecast of 549 jobs/year. (Something to do with Cranbrook but the details of this and whether there is any double counting remains a mystery). This 549 job/year figure was ultimately used to justify the final 17,100 minimum housing target for the 18 year period of the Plan adopted in 2016.
The plan requires a minimum average build of 950 houses/year. EDDC’s aspiration is to combine this with the creation of one job for every house built. But this demonstrates a complete failure to understand demographics and household formation. The need for houses and the need for jobs is not a simple equation of one with the other.
Papers attached to EDDC’s Strategic Planning Committee for 29 January 2019 (see footnote) contain data for East Devon employment covering 2009 to 2016. The explanatory text says: “It is recognised that it is an aspiration of Members [surely not every Councillor?] to deliver one job for each new home across the district but since the adopted Local Plan does not set out to deliver this it is not considered appropriate to formally monitor the relationship between the delivery of homes and the delivery of jobs.”
Here’s why – the real evidence, from the data, is of jobs growing at an annual rate of only 258 jobs/year.
This figure confirms the more modest forecasts presented by Ash Futures and, inconveniently for EDDC, is less than half of that used to justify the “Jobs-led Policy On” housing targets. It is only a quarter of the one job per house aspiration of “Members”.
Where does the 258 job/year trend come from? It is the gradient of the best fit linear regression trend line to the data given the Strategic Planning Committee and shown in the graph below. The full data source is referenced in the footnote.
This is a relatively small sample; and the extent of the fluctuations in the recorded number of jobs from year to year can be seen in the graph. For the technically minded the correlation coefficient of the trend line is 0.6, which is quite a strong one.
All the job number quoted above are for “full time equivalent” jobs (FTE).
Owl has been fortunate to find from the same official source as used by EDDC a set of estimates of the total number of jobs in East Devon which extends the time series to 2017. The significance of this is that the total number of jobs in East Devon fell between 2016 and 2017 and so we can expect the same to happen with FTEs. As a result Owl feels even more confident that the trend line shown above, despite the sample size, reflects what is actually happening.
The Local Plan has been in preparation since 2002 and EDDC has been following a growth policy for many years. So, although 2013 marks the formal start of the Local Plan, there is no statistical evidence to consider 2013 a “turning point” for job growth, though it does look to be an outlier.
With EDDC’s plan to build houses running ahead of creating the jobs needed for a sustainable community, just who are we building all these houses for?
Isn’t it time to cool the building programme, not ramp it up as Owl fears is being planned in the Greater Exeter Strategic Plan?
One of the key architects to all this is Councillor Paul Diviani. When asked at a recent council meeting why East Devon is taking all this development replied: “Because we have got the land, and we are good at it”.
Footnote: The combined minutes, agenda and reports of the Strategic Planning Committee with the job data for 2009 to 2016 on page 116 can be found here:
http://eastdevon.gov.uk/media/2744658/290119strategicplanningcombinedagenda_opt.pdf
Are the wheels falling off the East Devon growth wagon? | East Devon Watch
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