The Cycling Economy in Sheffield
This is a start on gauging the cycling economy in Sheffield. CycleSheffield’s argument is that cycling is a small but not insignificant part of the UK’s and hence Sheffield’s economy. Most politicians and business people understand that cycling is not just a recreational or transport option that some enthusiasts may take part in but that it is an activity that is increasingly being taken up because not only is it personally economical, but also it is attractive because it avoids and reduces congestion, increases health and wellbeing, and helps improve air quality and the environment. What they are often not aware of is the Gross Cycling Product (GCP) – the value of the market created by sales, servicing, accessories, promotion and training, tourism, and cycling events, and all the jobs and wages that go with that.
We have started to estimate the GCP by scaling down and interpreting national data to ‘fit’ to the size of Sheffield. Our next step will be to undertake a survey of local businesses to gauge whether these figures are approximately correct. The stage after that is to formally present these figures to politicians and business people in Sheffield to demonstrate that cycling is a serious business.
Cycling is of local economic benefit and they should take it seriously and support it, not just for all the usual reasons but that there is a business case to support cycling. And the stage after that will be to work with other groups and agencies across Sheffield City Region because that is the region which will be bidding for transport, including cycling, grants.
In 2010 an authoritative report (1) stated that the Gross Cycling Product (GCP) in the UK had a value of approx £2.9b. This is the market value of all the goods and services associated with cycling in the UK that the report could get reliable data for. The UK GDP in 2010 was £1.48t (2) so cycling is a very small but not insignificant part of the total economy.
In 2010 cycling took up no more than 2% of all trips made but targets of 10% of all trips by bike by 2025, and 25% of all trips by 2050 have been recommended (3). This will put participation in cycling in the UK on par with cycling in countries like the Netherlands and Germany and most of Scandinavia.
If these targets are met, and if one factors in the projected increase in population (4) then the GCP will expand at least by a factor of 5 in the next 12 yrs and a factor of 10 in the next 40 yrs.
The GCP in 2010 in the UK was made up of
£1.62b from bike sales
£0.85b from servicing and sales of accessories
£0.5b in wages (and £0.1b in taxes & NI) in sales, manufacturing and infrastructure.
Giving a total for the UK GCP of £2.9b
This calculation does not take account of
the money, other than wages, spent on constructing cycle infrastructure (benefit to cost ratio of 4:1)
the annual absentee cost saved through frequent and regular cycling (estimated by the report’s author at approx £128m pa)
the health cost savings for cyclists who tend to be healthier, slimmer and happier (no reliable data) and every bike trip reduces air pollution (500 deaths pa in Sheffield can be attributed to poor air quality which in turn is mostly attributed to exhaust fumes (5)).
the market generated by cycle tourism and recreational cycling especially off-road and touring activities, and cycling events (cf 2102 Olympics, TdF Stage 2 in Sheffield in 2014) for which there was no reliable data.
What does this mean for Sheffield?
Sheffield, with a population of 500k, can be considered as a “0.8%” city, in that its population is 0.8% of the UK population. Its key economic indicators should be approx 0.8/100 of the national figures. This assumption would indicate that the current GCP for Sheffield is of the order of £23.2m pa.
Absentee cost savings in Sheffield would be in the order of £1m pa. The health cost savings of cycling are in terms of the better general health and well-being of frequent and regular cyclists and the reduction in deaths currently caused by poor air quality have not been estimated.
Total UK sales of bikes was £1.62bn of which 0.8% is £13m pa notionally spent on buying bikes in Sheffield. 0.8% of the servicing and accessories figure is £6.8m so the notional total for sales of bikes and cycling servicing & accessories in Sheffield would be approx £19.2m. (NB many bikes and accessories are bought on the web).
The total national employment in cycling in 2010 was 23, 415 people, earning approx £500m. Scaling this to 0.8% would give a total of £4m in wages put into circulation in Sheffield via the bike business. It would also mean that approx 190 people are employed in Sheffield directly through cycling.
Add the last two figures in bold and the total GCP for Sheffield is of the order of £23.2m.
3.7m bikes were sold in the UK in 2010, which would give a notional total for 29,600 bikes bought pa in Sheffield. (NB this includes all bikes incl children’s bikes and approx 40% of the UK population claim to own a bike). Approx 650,000 people in the UK cycle for all of their journey to work (6). 0.8% of the national total gives a notional Sheffield total of 5,200 cycling to work every day. The 2011 Census recorded 4,374 Sheffield people stating that they cycled to work – this check means that we are in the right order of magnitude and that assuming Sheffield is a 0.8% city may be a reasonable assumption for gauging the GCP in Sheffield. Sheffield also has a very healthy sport and recreation road and off-road cycling scene and the sales of bikes to this market tends to be high-end, high value bikes and accessories. (In 2010 it was estimated that a new entrant enthusiast cyclist spends approx £2500 on bike and kit, a new entrant commuter cyclist spends approx £500).
So are the figures a reasonable estimate of the Gross Cycling Product in Sheffield?
Let’s go and find out.
If you want to help with this survey or have figures you can give or ways of doing this or suggestions to make about this project then leave a comment and/or email email@example.com. Thanks.