A quarter plan to ‘re-shore’, says report
NEW research from GE Capital and Warwick Business School has found a quarter of mid-market firms in the UK are considering re-shoring some, if not all, of their movable business activities within the next three years.
The cumulative effect of this is the projected creation of an extra 126,000 jobs across the UK per annum.
Additionally, the research finds that on average mid-market executives expect, over a three-year period, to see an increase in revenues of 14.8% – or £3.8m per firm per annum – as a result of this domestic relocation, which they estimate will help drive an average up-lift in profits of 12.1%.
Cumulatively, this would add £27.6bn to national mid-market revenues annually, which are already expected to add a projected £133bn in revenues over the next 12 months. However, it would seem that the Greater London area will be the main beneficiary of this re-shoring activity.
Professor Stephen Roper of Warwick Business School said: “Historically, re-shoring activity has focused on regions outside London, yet our research indicates that mid-market firms see the value of being active in the capital, despite the high costs associated with doing business here.
“This suggests that rather than acting as an agent for rebalancing the regions, re-shoring may exacerbate the growing disparity between the London economy and the rest of the UK.”