State of the Region: Positive outlook but challenges ahead

BUSINESS leaders across TheBusinessDesk.com’s commercial heartlands of the West Midlands, North West and Yorkshire are united in their belief that confidence levels are rising and 2011 offers opportunities despite the challenging economic environment.

And in a major boost for their respective markets, the majority of those taking part in TheBusinessDesk.com’s State of the Region Survey, supported by law firm DLA Piper, believe the three regions remain positive places to do business.

More than 1,000 readers took part in the online survey, which gives a comprehensive view of business sentiment across three of the UK’s most successful and major economic regions.

Comparing responses from the West Midlands, North West and Yorkshire, although the majority of people agreed on many of the issues raised, respondents differ on what areas need to be addressed to further drive growth in their region.

In Yorkshire and the West Midlands, transport and infrastructure are seen as key, while access to finance is a major issue in the North West.

The Coalition Government will have a negative impact on the UK economy, according to the majority of respondents in the West Midlands, while Yorkshire and North West respondents believe it is too early to tell.

DLA Piper logoSalary and pay issues are viewed as the main employee issue that businesses anticipate facing in the next year across the three regions, closely followed by recruitment of new staff.

 The majority of businesses across the three areas expect to see their firms grow in 2011 and are looking to target new UK markets.

Regional and local markets are seen as key across the trio while the majority of businesses anticipate cuts to public spending having a direct impact on their bottom line.

Understanding of Local Enterprise Partnerships, the bodies set to replace regional development agencies like Advantage West Midlands, is also unclear, with not one single respondent in the West Midlands having a clear understanding of their future role.

FURTHER ANALYSIS OF THE SURVEY:

DAY ONE: Austerity measures won’t stop growth

DAY TWO: Half of firms expecting to recruit in 2011

DAY THREE: Lack of clarity on LEPs

DAY FOUR: Firms braced for cuts

BLOG POST: Why our State of the Region Survey matters

FULL REPORT: Download DLA Piper’s analysis of the survey here

In Yorkshire and the North West, the majority of respondents said they did not have a clear understanding of new regional funding structures, such as the Regional Growth Fund, while in the West Midlands almost half said they had some idea of how the funds would work.

Across the three regions, respondents are in agreement that economic conditions will remain as they are in 2011 and bank lending will stay at similar levels to 2010 during the year.

Russell OrmeRussell Orme, left, managing partner of DLA Piper in Birmingham, said: “The results of the report have highlighted the challenges that businesses face in the coming year, but also the opportunities. The market is still difficult, but clear signs of renewed life are emerging.

“A high number of businesses in the West Midlands are entering 2011 with objectives in place to target new markets or develop new products and they predict positive growth in their profits and payroll. So over the next 12 months we could be laying the foundations for some real progression in the regional economy and employment levels.

“The survey also shows a consensus among regional business leaders on the issues that matter to the West Midlands, such as clarifying the role of LEPs, long term strategic planning and fostering better idea sharing among business leaders.

“While many of our opinions and predictions are mirrored by our business counterparts in Yorkshire and the North West, the survey highlights areas of specific concern to the West Midlands and provides useful guidelines on the issues that need to be addressed in the region.

“For example, lack of skilled labour was more of an issue for West Midlands’ respondents than those from the North.

“With the Government encouraging the private sector to have a more active say in regional development, it is important that in 2011 local businesses come together to make sure our views are heard and take positive action where we can to facilitate the kinds of changes that we wish to see for the region.”

 

State of the Region: Your views
Do you anticipate cuts to public spending having a direct impact on your business?


“As a consultancy business offering coaching and mentoring, 60% of my business has had some level of funding support.”

“Will impact on funds available to develop small businesses, reduce knowledge requirements from public sector bodies, in addition to core training that we deliver and reduce our core funding.”

“Less consultancy spend in public sector, more supply for private sector, oversupply of resources and downward pressure on fee rates.”

“Business support funded via AWM! Will LEPs work? How will they work?”

“We carry out a lot of work in the public sector and there is a concern the private sector will not be able to take up the slack.”

“Where contracts are lost, others will be gained.”

“We are part publically funded and will be experiencing a 50% cut in this funding in 2011/12.”

“We do some work in the public sector therefore this line of business will diminish initially. Most services will be outsourced that may be more profitable for us in the long run!”

“We have been commissioned by Government agencies national and regional to undertake project work, the funding for which no longer exists.”

  • We hope you have enjoyed the coverage of our State of the Region Survey. Please leave your thoughts in the comment box below or email us at newswm@thebusinessdesk.com.

 

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