As Jersey tries to grow its digital industries in order to keep economic stagnation at bay, Gallery takes a short course in economic history and looks at some of the milestones in our Island’s attempts to keep the money flowing.
Jersey is an old hand at making money. In fact, there’s evidence of economic life on these shores dating as far back as Neolithic times. The remains of oyster shells at La Hougue Bie, for example, have been discovered in the Neolithic passage grave which was constructed as much as 4,000 years ago. Still a successful business today, oyster collecting and farming have been an Island trade for thousands of years!
Much closer to now, Jersey was once home to a thriving ship building industry that ranked as high as being the 4th largest ship building area in the British Isles during the 19th century. Did you know that over 900 vessels were built around the Island during this period?
Of course, we’ve all heard the word ‘Jersey’ being used to describe knitted jumpers and the reason for this is that Jersey was genuinely famous during medieval times for its knitting trade. The industry continued successfully until the 18th century, in fact it was so successful with the production of knitwear reaching such a massive scale that it threatened the Island’s ability to produce food. The result? Laws were passed to regulate who could knit with whom and when!
Although today, it might be hard to see past the finance industry which heavily dominates our economy, during the past century the Island’s economy has largely been made up of tourism and agriculture.
At the beginning of the last century, agriculture was of incredible importance in the Island, with cider production being the largest industry, exporting over 1.2 million litres of cider to England per year in its heyday. It wasn’t until the Great Storm of 1987, which destroyed so many trees that the Island became close to losing many of its traditional cider apple varieties and made an effort to preserve them.
Throughout the past 100 years, agriculture has continued to be extremely important, with potatoes, cauliflowers, tomatoes and flowers being the most significant Island crops. Today, the majority of these are shipped to the United Kingdom. As much as 99% of our widely celebrated Jersey Royals are exported to the UK, making it the most important crop for farmers’ profits.
And of course, who can forget our beloved Jersey cow? Renowned for the rich, creamy milk that so many love, it is famous worldwide, and still, the Jersey breed of dairy cattle represents a significant export income earner today.
During the post WW2 years, Jersey saw a major boom in tourism, with thousands of visitors choosing the Island as their tourist destination because of its spectacular beaches and idyllic countryside, which meant that millions of pounds were pumped into the economy every year. However as this boom has been winding down since the late 1980s, many large holiday-hotels and tourist attractions have been demolished and we have watched the finance industry slowly take over.
Despite Tourism’s recent efforts to attract holidaymakers back to the Island, notably by the States spending £1m on a Jersey tourism TV advertising campaign last year, nobody can deny the major fall in tourism in the 21st century.
If you had last lived in Jersey 40 years ago, and returned today, you might be shocked at the change in economy caused by the enormous growth of financial services. With over 26 banks, 200 Trust companies, a fund management sector worth a neat £179 billion, over 32,000 registered companies and more than £189 billion deposited into the Island at any one time, Jersey has earned its place in the top division of offshore finance centres.
So what will the future bring?
As the finance industry has continued to grow, more small local businesses have begun to disappear. St Helier has already seen many stores shut their door for the final time, and of course the recent closure of the Channel Island Bakery has caused much controversy amongst Islanders
Based on the last 100 years, the likelihood is that Jersey will continue to become less self-sufficient, as UK chains take over the few remaining local businesses.
But can the finance industry realistically continue to grow, or even sustain itself, without some diversification of Jersey’s economy?
Digital Jersey are already working to promote the Island as a digital centre, encouraging businesses involved in hosting, e-banking, cloud services and software development to set up on our small rock. When you think about it, ‘digital’ is already partly responsible for the slow transition of Jersey’s High Street. The more people switch to the Net for household shopping or buying music, the more local stores will be banished from our shores forever.
That said, the reality remains that it is dangerous for the Island to rely so heavily on one sector. One way or another, the next 100 years has to bring diversification of the Island’s economy. Whether Jersey will become a digital centre of excellence or will return to popular industries of the past, the future evolution of Jersey’s economy remains unknown but is awaiting us all.