CLUSTERING CREATES EMPLOYMENT IN DIGITAL INDUSTRIES
20 years ago The Custard Factory Quarter, adjacent to Birmingham’s city core, was a run down inner city area of semi derelict industrial buildings - mostly empty, neglected, vandalised and seemingly without hope. Against this backdrop in 1992 the Custard Factory was launched to provide work space to creative and artistic businesses. Until the launch of the Custard Factory there hadn’t been a place in Birmingham where such businesses clustered. Word spread that a new place was being created specifically for creative and artistic businesses. There was a surge of interest and the project filled with 130 businesses before the planned marketing campaign had even started.
This cluster of creative and artistic businesses has prospered ever since, grown to occupy several additional buildings and now runs to some 400 businesses. As the digital economy has flourished, the cluster has adapted itself to address the opportunities that the new economy offers. Location in terms of region or country or even continent is no longer as important, but a sense of place and belonging is crucial. So it is that businesses in the Custard Factory Quarter can compete in the global digital economy.
In 2008 Fazeley Studios was launched providing studio workspace solely for digital businesses. In spite of the recession Fazeley Studios quickly filled with both SMEs and very well established digital businesses (including a computer games division of Microsoft). In the process a marker was laid down – The Custard Factory Quarter was to be the place where digital business would be done in Birmingham.
The Custard Factory Quarter now has one of the largest clusters of digital enterprises in the UK outside London. This has brought much needed employment in future facing industries to the region and helped to retain talented graduates who otherwise might have left for the capital. It is a neighbourhood with a distinctly different atmosphere from the rest of the city centre, and is sometimes referred to as a city within a city. The Quarter gives Birmingham much needed identity to complement its strengths in mainstream shopping, professional services and traditional manufacturing.
As a result of the independent spirit that the Quarter has come to be known for, other independent strands of economic activity have come into being in the area. Most of Birmingham’s alternative nightlife now takes place in the area, and it has developed as an alternative independent shopping destination.
Originally seeded by modest capital grants on a gap funding basis, a sustainable new creative and digital working community has been established by using the power of clustering similar businesses in a clearly defined area.
Anecdotal evidence suggests that a large number of the people who have started businesses in the Quarter would not have taken the brave step of setting up on their own had a clearly defined cluster not existed. The presence of these entrepreneurs has in turn attracted larger occupiers looking to tap in to their creativity, skills and services.
Now the Quarter is home to a diverse bustling working community ranging from small businesses with a handful of employees to international companies employing people in “live end” jobs. In addition to studio offices there are cafes, restaurants, clubs, a theatre, specialist shops and public open spaces.
So far the leading development projects in the Quarter - the Custard Factory and Fazeley Studios - have generated nearly 2000 jobs in an area where a few years ago there were virtually none. Every month new digital businesses are moving to the area seeking to be a part of, and take advantage of the business ecosystem that has been created through clustering.
Despite problems in the wider economy, by virtue of tapping into the booming digital economy many businesses in the Quarter are prospering and hiring new staff even in difficult times.
The Custard Factory Quarter’s recognised success has spurred major local land owners and the local authority to work with the Custard Factory to establish a plan for the regeneration of the wider neighbourhood – Digbeth. Working together to capitalise on the medium and long term advantages of the HS2 terminus which will be built on the border of Digbeth and the city core and the recently established Enterprise Zone, it is hoped that that the employment intensive uses established by the Custard Factory and Fazeley Studios will spread to the wider area of Digbeth. There is potential for more than 10,000 people to be at work in digital industries in Digbeth by 2020 with relatively modest but skilfully targeted assistance.