THE ECONOMIC AND ENVIRONMENTAL IMPACT OF THE HISTORIC AND CLASSIC MOTOR INDUSTRY IN THE UK

40 → 6.3 The economic impact From these expenditure estimates, we can map out the full set of economic impacts associated with the sector. The results from our survey indicate several interesting trends for firms involved in the maintenance and repair of specifically classic vehicles, compared to the wider sector for all vehicles. Firstly, a significant wage premium (approximately 70%) exists for workers in the classic sector. This is presumably driven by the more specialised nature of the work and greater skillset required. Anecdotally, this may also be caused by a limited supply of labour driving up average wages - several firms we spoke to referenced a difficulty in finding labour with the required skills. These higher wages also drive up the share of costs that are labour vs non-labour. For the wider vehicle maintenance and repair sector, labour costs make up approximately 17% of total costs for the average firm. However this more than doubles to 35% for classic restoration and repair firms. These findings allow us to modify our e stimate for the cost structure of the ‘average firm’ in the classic vehicle restoration and maintenance sector. From this, we can estimate wider macroeconomic impacts, including GVA, employment and total employee compensation for the sector. These results, for service-based maintenance and repair, parts and accessories, and a total sector estimate can be seen i n Table 13. Table 13: Economic impact of maintenance, repair and spending on parts for classic vehicles, 2019 Revenue (£m) GVA (£m) Employment (FTEs) COE (£m) Maintenance and repair of classic vehicles 2,713 1,203 23,783 801 Sale of parts and accessories 437 126 1,830 69 Total 3,150 1,329 25,613 870 Source: FBHVC, ONS, Cebr analysis The size of the industry is considerable, with the £3.15 billion per annum in spending, generating £1.3 3 billion in GVA for the UK economy and supporting over 25,000 FTE jobs. On average, £33,962 per annum is paid in employee compensation per FTE worker. Another way of conceptualising this is that, in GVA terms, every classic vehicle directly added £440 to UK GDP in 2019, solely through spending on maintenance, repair and parts. In addition, one FTE job was supported for every 127 vehicles, through this same channel.