East Midlands beating West in terms of growth prospects, says top investment boss
The East Midlands is particularly well-placed for growth, and there are three key reasons why its prospects currently trump those of the West Midlands according to one of the region’s top investors.
Recent ONS statistics show that the East Midlands’ economy is growing at a faster rate than that of the West Midlands.
Gurinder Sunner, head of the Midlands investment team at Business Growth Fund, believes the investment outlook is brighter in the East Midlands because of the volume and quality of its medium-sized businesses and its advantageous location.
He said: “The East Midlands has a large number of what I would call high quality SMEs – possibly with more in the ‘M’ category – that are turning over between £10 million and £100 million. It beats the West Midlands in that respect, and I say that as a Brummie born and bred! These companies are also operating in wider variety of sectors than their counterparts in the West Midlands.
“Moreover, the East Midlands is a great location in terms of transport and logistics, especially if you include Northamptonshire in the equation. There are simply too many cars on the roads in the West Midlands. I’d much rather be on the M1 corridor than the M6 corridor.”
Sunner also says the sheer variety of businesses operating in the East Midlands gives the region another advantage over the West Midlands.
He said: “The West Midlands has a kind of cyclicality in the economy driven by the automotive sector. There is a bigger effect on the wider economy if a company like Jaguar Land Rover is doing well, or poorly, but there is less sector concentration in the East Midlands. The region is less dependent on one sector.”
However, as the Brexit saga rumbles on, Sunner feels that some East Midlands businesses might not be taking full advantage of the opportunities afforded by the region’s fast-growing economy.
He said: “I’m not sure how ambitious East Midlands firms are from an export perspective. It is easier selling on your own doorstep, but if you can get exports to work you can generate growth very quickly. Brexit might be a convenient excuse for people not to do it.
“On the other hand, businesses want clarity and people just don’t know what the world is going to look like in 12 months’ time. CEOs need a clear picture before they make investment decisions. If the Brexit extension announced today allows us to achieve some clarity, then good.”
He added: “The lack of a coherent local investment strategy could be holding things up too. There are too many different bodies out there, whereas things are a bit more streamlined in the West Midlands. Help is out there but a lot of businesses don’t know how to access it.”