Reshoring ‘could add £2.4bn to North West economy’

THE North West could be the top UK region to benefit from the positive impact reshoring could have on the country’s economy over the next 10 years, according to new research from professional services firm EY.
 
The report, Reshoring – Time to seize the opportunity, calculated that reshoring could contribute £2.4bn in GDP and 46,200 jobs to the North West economy over the 10 year period to 2025.
 
The region came out top of the list of 11 UK regions analysed in terms of GDP that could be added by reshoring, closely followed by the South East (excluding London) (£2.0bn GDP, 35,500 jobs), the West Midlands (£1.8bn GDP, 35,000), and Yorkshire and Humber (£1.7bn GDP, 37,900 jobs). The North West was also identified as the region where the most jobs could be created via reshoring.
 
Reshoring has the potential to contribute a total of £15.3bn of GDP and more than 315,000 jobs to the wider UK economy, presenting a once-in-a-generation opportunity, according to the report.
 
North West senior partner at EY, Simon Allport, said: “These results are hugely encouraging for the North West region, which has significant potential to attract reshored activity over the coming years.

“This is thanks in part to our connectivity to the UK and the world via our international airport, and national road and rail links; a developed, globally integrated business services community, and our skilled labour markets.
 
“Offshoring in the 80s and 90s saw a dramatic reduction in British manufacturing and a shift to services industries that resulted in a fundamental restructuring of the British economy. While some regions saw rapid growth and wealth creation, others suffered from high rates of unemployment.

“But the economics underpinning this trend appear to be reversing, and present the North West and the wider UK with a once-in-a-generation opportunity. While increasing wages in developing countries are eroding their labour cost advantage, there are many more factors driving business to choose our shores.

“The desire to guarantee quality and the imperative to reduce time to market are increasingly important drivers of location decisions.”