Local Plan 2045 Scoping Consultation

9. Employment and Economy

9.1The plan area has a diverse and resilient economic base with particular strengths in automotive manufacturing (being home to Rolls-Royce), health, retail, horticulture (with some viticulture - although most vineyards are located in the South Downs National Park just outside the plan area). The plan area also enjoys a strong visitor economy linked to its high-quality natural and historic environment which supports its hospitality, tourism and marine-related leisure businesses, particularly in the south of the plan area at Goodwood, the coast and the historic Chichester city. Micro and small businesses are also well represented, and small businesses have a good survival rate. However, 43.6% of the district population is economically inactive reflecting, in part, the ageing population.

9.2The rural parts of the plan area are characterised by high-quality agricultural land and a favourable climate. Agriculture and horticulture remain significant sectors of the rural economy and contribute to the wider regional and national food supply chain. Increasing pressures, including rising costs, labour shortages and the need to adapt to climate change and environmental regulation have led to diversification within the rural economy which encompasses traditional glasshouse production and land-based farming alongside a growing range of modern and new business activities such as food processing, research and development, farm shops, tourism and renewable energy generation. This diversification has helped to sustain rural incomes and create new employment opportunities.

9.3The council recently renewed its Economic Development Strategy to 2030. The strategy, which covers the whole District, recommends a targeted approach to supporting indigenous businesses with high growth potential, as well as supporting inward investment. The strategy also recognises the impact of climate change and commits to supporting sustainable businesses such as renewables, retrofitting and the circular economy. Retaining people of working age is important as is education and training.

9.4A Regeneration Strategy for Chichester City prepared by the council in 2024 sets out opportunities that can help respond to wider issues around attracting investment and business, enhancing employment opportunities, infrastructure development and sustainability as well as physical transformation. The Strategy sets out 5 outcomes:

• A better-connected city
• A greener, healthier and safer city
• A diverse and inclusive city
• An economically prosperous city; and
• An attractive and vibrant city destination

9.5Although not prepared as part of the local plan, the new local plan will play a key role in supporting delivery of the strategy, including consideration of potential development/redevelopment sites.

9.6Following on from the Regeneration Strategy, a Hotel Market Assessment Study (2025) identifies a need for 65-107 additional hotel rooms in Chichester city by 2029 to keep up with demand. There is a particular lack of supply of mid range accommodation, with most stock in the budget sector, and around 16% at the luxury end of the market.

9.7There has also been a market assessment to explore the feasibility of providing a multi-purpose arts and live music venue for Chichester city centre, identified as a gap in the city’s cultural infrastructure, as part of improving the evening and night time economy, The assessment, prepared in 2025, recommended that such a venue should be suitable for between 250 and 600 people. An update to the study in 2026 notes that whilst Room 12 (formerly the Vestry pub) is now operating as a mid-sized music venue, there remains scope for a purpose built venue to host an audience of up to 600 to supplement the smaller performance spaces offered by pubs and other multi-purpose spaces such as community centres.

9.8Since the Chichester Local Plan 2021-39 was adopted, Rolls-Royce has received planning permission and started construction of an extension to their premises at Westhampnett, on a site safeguarded for that use in the local plan. The local plan also allocated a 19ha employment site on land south of Bognor Road as well as retaining most allocations from the previous plan that were not yet complete – to deliver 115,00sqm of additional employment floorspace across the plan period. New evidence will be needed to determine the amount and type of employment space needed to 2045. Alongside this the adopted local plan continued to identify areas for large scale horticultural development to be located, including extending the horticultural development area (HDA) at Runcton.

9.9Chichester city centre continues to provide a varied retail offer, supported by out-of-town retail parks and local centres identified at East Wittering and Selsey. The adopted Local Plan does not allocate land for retail development, instead directing it to vacant retail premises and new development within strategic sites. New evidence will be needed to establish whether the retail needs forecast to 2045 can continue to be dealt with in this manner, or whether new retail allocations will need to be made.

What are the challenges and opportunities?

9.10The plan area faces a number of challenges in maintaining and enhancing a strong, diverse and resilient economy.

Challenges

9.11Challenges for the economy include:

9.12Ageing population resulting in a declining proportion of working age and high economic inactivity rate.

9.13Retaining skilled young people and students to increase the working age population.

9.14High in-commuting rates, likely linked at least in part to house prices, primarily from Arun, Havant and Portsmouth, with a lower level of out commuting, primarily to Arun.

9.15Rural nature of parts of the plan area creates additional constraints in terms of connectivity (physical and digital) and access to labour. The presence of designated landscapes and habitats also limits the scale and location of some forms of development.

9.16As a result of shifting retail trends, the growth of online shopping and increased home and hybrid working, maintaining the vitality and viability of Chichester city centre and the smaller local centres is an ongoing challenge, including protecting the retail element whilst allowing some diversification of uses.

9.17Suitability of some of the existing employment stock/ pipeline supply to accommodate expanding indigenous businesses and changing market needs.

9.18Transitioning to a low carbon economy presents both practical and financial challenges for business particularly smaller enterprises which may lack the resources to invest in new technologies, decarbonisation measures and changes to working practices.

9.19Limited brownfield sites likely to be available for employment development.

Opportunities

9.20Despite the challenges, there are significant opportunities to build on the plan area’s strengths and support a more diverse, resilient and sustainable economy.

9.21Opportunities include:

9.22Building on strong economic and specialist sectors – the presence of major employers such as Rolls-Royce and Goodwood, alongside a strong visitor economy and a specialism in horticulture and food production provides a good base for growth, expansion and diversification

9.23Building on the council’s Regeneration Strategy to strengthen Chichester city and local centres as hubs for employment, culture, leisure and investment

9.24Supporting tourism and leisure, including the evening and night-time economyGrowing and strengthening the low carbon, marine and rural economy

9.25Supporting measures that help young people and students to stay in the area to increase the working age population. Support links between businesses and higher education providers to drive innovation, entrepreneurship and skills development

9.26Maximising economic benefits of the plan area's natural capital (although this need to be balanced with environmental protection)

9.27Improving digital connectivity to provide opportunities for business growth and enhance accessibility

9.28Address potential barriers to investment

9.29National policy changes in the draft NPPF mean that some elements of the current plan will be covered by national decision-making policies. The Chichester local plan will need to provide conditions for long term economic growth by setting a clear economic vision and strategy and identifying suitable sites for economic development, considering specific locational requirements of different sectors, whilst not being too prescriptive about the type of employment use on each site. There is an emphasis in national policy on knowledge clusters, storage and distribution and the modernisation and/or expansion needs of local and regional businesses. New evidence will be required to inform decisions on the amount and type of employment space required. National decision-making policies are likely to cover freight and logistics, and rural business needs, including supporting domestic food production.

9.30In terms of retail, the draft NPPF continues to propose a town centre first approach, however there are clear indications that town centres will need to diversify to include a broader mix of uses to maintain their vitality and viability. There will need to be a balance struck between continuing to protect the retail element of the city centre, with the provision of new housing in a central location. There are some questions about whether the sequential test will remain, and whether the impact assessment should be considered on a localised basis. The adopted local plan contains a bespoke impact assessment threshold, and evidence will need to be sought to continue to support and, if necessary, refine this approach.

What are the key priorities?

9.31The local plan will need to consider the following priorities for economic development and employment:

Deliver a suitable mix and quantity of employment sites to meet current and future needs.

9.32The requirements will be informed by updated evidence and will need to consider the needs of new businesses and growth needs of existing businesses so they can stay in the area, as well as inward investment.

Support the growth of a resilient and diverse economic base

9.33Maintain and strengthen a broad range of economic sectors including specialist manufacturing, horticulture, food production, tourism, hospitality, marine-related industries alongside emerging knowledge-based and low carbon sectors. Support the continued success of existing key sectors.

Support a low carbon and sustainable economy

9.34Facilitate the transition to a low carbon economy by encouraging energy efficiency and sustainable business practices whilst supporting the growth of green technologies and industries. Direct employment development to accessible locations, reducing the reliance on private car travel and supporting more sustainable patterns of movement.

Enhance skills, innovation and workforce retention

9.35Encourage links between businesses and higher education providers and those sectors that contribute to higher-value employment and productivity. Facilitate and support development of businesses that provide employment opportunities across all skill levels and enable retention of young people and skilled workers.

Support the rural economy

9.36Enable the sustainable growth and diversification of the rural economy including agriculture, horticulture, tourism and rural enterprises while addressing infrastructure and accessibility constraints and protecting the natural environment of the plan area.

Strengthen Chichester City and Local Centres

9.37Support the growth of Chichester city as a vibrant and sustainable economic hub with a diverse mix of business, retail, leisure and cultural uses. Support the vitality and viability of the city centre and local centres in meeting the needs of their communities and reducing the need to travel.