Bustling market scenes — complete with crowds of buyers and sellers, soothsayers and moneylenders — are the stuff of Shakespeare plays.

But this is not Elizabethan England; it is recessionary Britain and the bard’s home town of Stratford-upon-Avon boasts thriving retail and finance industries. All that is missing is the soothsayer.

Stratford-upon-Avon, the market town in Warwickshire, has shrugged off the worst of the recession thanks largely to its strange mix of financial services and cultural tourism.

However, to say that Stratford has a strong finance sector is an exaggeration.

“Financial services accounts for around 25 per cent of the local economy,” Lindsay Sinclair, chief executive of NFU Mutual, the insurer, says.

“But that’s basically us.” Founded by seven Stratford farmers in 1908, NFU Mutual is now the town’s largest employer with 1,395 staff.

“Having a large, stable financial services business that has been here for 100 years, and survived the recent turmoil so it will be here for another 100, is a real benefit to the local economy,” Mr Sinclair adds.

He is happy to provide examples of how business is booming. Premium income for general insurance grew 5 per cent to £990 million “in an incredibly tough environment” in the year to May.

Life insurance revenues grew by 1 per cent, Mr Sinclair continues, “which doesn’t sound a lot, but remember that the market as a whole fell 10 per cent”.

That growth has already led to the creation of new jobs: 200 over the past 18 months with plans for another 300 to 400 in the next three years. Most will be in NFU’s expanding network of more than 300 branch offices.

But if all goes to plan, the increased sales that follow will feed back into greater demand for investment, claims and administration roles in the company’s headquarters in Stratford.

Asked what NFU is doing differently from its rivals, Mr Sinclair cannot resist a reference to Shakespeare, citing his warning hundreds of years before derivatives were invented, that “all that glisters is not gold”.

Mr Sinclair is proud to say that he has taken the local wisdom to heart and steered NFU policyholders’ money away from the complex and ultimately toxic financial wizardry that characterised much of the recent history of financial services.

“We haven’t been into CDOs [collateralised debt obligations] or MBSs [mortgage-backed securities] or got caught up with Lehman Brothers or Icelandic banks.”

NFU may be Stratford’s largest employer, but the Royal Shakespeare Company (RSC) is its most prominent. Neither has shed staff in the past year, helping Stratford to maintain the lowest unemployment rate in the West Midlands at 2.6 per cent.

The home of modern Shakespeare performances is also enjoying a good recession, with strong sales and almost full theatres.

“You might expect things to be difficult for us in this kind of economic climate,” Chris Hill, the RSC’s director of sales and marketing, says, “but entertainment seems to be at the front of people’s minds as they try and escape the doom and gloom.”

Mr Hill concedes that his escapism theory relies on anecdotal evidence but there is no denying that something is pushing people to buy tickets.

“We’re playing to theatres that are about 90 per cent full this season, which we are very happy with,” he says.

Of course, tougher times mean people’s habits have changed. “Couples or families who may have come three or four times a season might come two or three times this year. Or they might buy cheaper tickets. But the important thing is they are still coming.”

That people continue to flock to Stratford to see RSC performances remains fundamental to the town’s wider economy, according to David Hartley, business development and finance director at the Coventry & Warwickshire Chamber of Commerce.

With so many visitors — and not only overseas tourists — choosing to turn their theatre trip into a mini-break, the RSC’s continued success affects everyone from the ice-cream van outside the theatre door to local hotels, restaurants and retailers.

One man benefiting from the town’s steady flow of tourists is Mark Archer, owner of Vinology, an upmarket wine shop located almost directly opposite the house where Shakespeare was born.

Mr Archer opened his store on Henley Street “as a hedge to my wholesale business, which is quiet during the summer”, and he was attracted to Stratford by its constant stream of shoppers.

When The Times visited Henley Street, the shops were crowded with visitors. But are tourists, who have already paid for travel, accommodation, food and theatre tickets, also stopping to buy £20 bottles of wine?

Yes, Mr Archer insists. “Easter was absolutely fantastic and we’ve had double-digit sales growth this year.”

Stratford, already firmly established on the tourist trail, attracted further interest this year when it was named the world’s most charming town by the travel website TripAdvisor.

Away from the theatres and gift shops is what Mr Hartley calls the less “chocolate box” side of Stratford. “Tourism and retail have held up but it is also a town of trading estates and industry where there is a different story,” he says.

Stratford may enjoy the lowest unemployment levels in its area but that does not say much. The town is surrounded by heavy manufacturing and motor-related industries, much of which, already in decline, has been finished off by the recession.

A 2.6 per cent unemployment rate is also more than the town is accustomed to. “The number of unemployed has gone up 100 per cent in the last year, so it has gone from tiny to not a lot,” Mr Hartley says. “But it’s still quite significant in local terms.”

The largest local casualty has been Precision Antennas, a manufacturer of satellite dishes and microwave components. Its recent closure added 350 names to the regional unemployment statistics.

A writer on a local community website wearily described the shutdown as “the demise of another UK manufacturer”, after Precision’s US owners shifted production overseas to reduce costs.

Not far away, one successful company’s experience is a sign of Stratford’s wider struggles. At Pashley Cycles (see right), business is booming and the old-fashioned-bicycle maker recently advertised vacancies for assembly staff.

But instead of the 25 to 30 applications that it usually fields for similar positions, Pashley received 200 — and would probably have been inundated with more from unemployed people if it had not closed the application process early.

Adrian Williams, managing director of Pashley, says: “We’re doing well but it’s not the same elsewhere in Stratford. The closure of Precision Antennas nearby was a blow and on this road there’s a plot that used to be a plastics business that has been closed for three years. On this industrial estate, things aren’t that good.”

But despite the rise in unemployment and collapsing businesses, the general mood in Stratford remains optimistic.

Mr Archer, the wine merchant, says: “I was walking around town last week and noticed that four new restaurants have opened. People are obviously confident that things will pick up if they are opening new businesses.

“There are still too many empty shops around,” he adds, “but there’s a recession on and I don’t know a town in the country that doesn’t have the same problem.”

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