Region could leave up to £5.4bn growth on the table in 2018, report finds

Businesses in the Yorkshire and Humber region could miss out on up to £5.4bn untapped growth in 2018, according to new research released today from Grant Thornton.

Based on a survey of 1,000 UK businesses with turnover between £10m to £1bn and interviews with senior business leaders, the report identifies barriers to growth for UK companies – including Brexit, technology and skills – which it says, if surmounted, could unlock an estimated £72.5bn in gross value add across the UK economy.

In Yorkshire and the Humber, this figure breaks down to £5.4bn.

Grant Thornton’s research maps attitudes and outlooks with businesses it has dubbed ‘Growth Generators’, a cohort of UK businesses that have achieved at least 20% annual turnover growth in the last year. These 12% of responding businesses have unique characteristics that have contributed to their success.

Andy Wood, practice leader of Grant Thornton UK LLP in Yorkshire, said: “Our region is home to strong, successful mid-market companies, who have the potential to unlock further growth by recognizing the opportunities and knowledge they could gain from Growth Generators.

“These Growth Generators are almost five times more likely to be achieving their one to two-year growth targets. Whilst businesses in the Yorkshire and the Humber share a lot of the same characteristics as these Growth Generators, they are purpose-driven and networked, there are further opportunities that could be leveraged by seeking their advice and support.

“Grant Thornton will be looking at how we help to unlock this untapped potential by building on this research through our ongoing work to build a vibrant economy in the region.”

The findings in the region found:

• Brexit uncertainty: 44% think that the political uncertainty is holding business back with 41% believing it deters international expansion, despite 48% rating international expansion as important for growth.
• Company vision and culture: One of the areas where Yorkshire and Humber business owners are short of confidence is in implementing company vision, culture and purpose as an accelerator to growth. Just two-thirds (67%) believe they do this effectively compared to 82% of Growth Generators.
• Talent, skills and innovation: This remains a key accelerator to growth, but just over half (55%) expressed confidence in this area, against 66% of Growth Generators.
• Inclusion and equality: an issue identified as a barrier in the region’s cities, revealed another contrast between Yorkshire and Humber businesses and Growth Generators, with 77% of those that stated it as an accelerator confident in their ability to leverage this versus 94% of Growth Generators.
• The role of culture: Only just 30% of Yorkshire and Humber businesses felt confident in being able to assimilate local culture and amenities versus 61% of Growth Generators.
• Technology: In Yorkshire and the Humber, recognition of technology as a growth accelerator is high, with 61% citing it as one of their top five investment priorities. But in terms of investment made so far, technology ranks lower than regulation, risk, talent and implementing company vision, culture and purpose, and partnerships.