Region is powering ahead rest of UK

Growth

Businesses in the Northern Powerhouse region have cast aside their Brexit fears to outperform the rest of the UK.

Latest figures reveal that private sector output growth hit a seven-month high in April and was stronger than in any other UK region.

Job creation in the Northern Powerhouse area also outperformed the UK as a whole – with 42,000 more people in work in region compared to 2018 as a result of long-term expansion plans and new product launches.

Lord Jim O’Neill, vice chair of the Northern Powerhouse Partnership and one of the leading architects of the project, is pleased with the investment being attracted to the North – but adds more work is needed.

He said: “If you consider the same PMI data in the context of the past five years, and particularly the past three, the Northern Powerhouse has begun to outperform London.

“For the Northern Powerhouse to be a success it must sit at the heart of the UK’s international connections and export relationships.

“In terms of connectivity we can see through Manchester Airport’s direct flights to China and £1 billion investment in its terminal the north is placing itself in prime position to attract foreign investment.

“Similarly, ABP’s investments in Hull and Immingham have seen shipments originally intended for Dover moved to the north.

“Sirius Minerals’ investment in its fertiliser mine on the Yorkshire coast will not only transform the local labour market but will add a significant sum to the UK’s export figures.

“To build on this success, further work still needs to be done, particularly in the area of connectivity. Not only will this improve the experience for those visiting, it will hugely improve the ability for the people living here to move around more easily and access a greater range and number of employment opportunities.”

According to the latest figures the majority of firms see output rising over next 12 months – but political uncertainty and Brexit worries are clouding business optimism.

The NatWest Northern Powerhouse PMI survey also reported that Northern business leaders want greater collaboration and a focus on new technology to ensure a “positive future” for the private sector.

Sebastian Burnside

Sebastian Burnside, NatWest chief economist, said: “The UK economy beat expectations in Q1 this year with GDP expanding by 0.5 per cent in the quarter, meaning that output is now 1.8 per cent higher than a year ago.

“But the Northern Powerhouse economy looks to be performing even more strongly judging by the reports from businesses in this research.

“Such strength is being translated into greater opportunity. There are 42,000 more people in work today across the regions of the Northern Powerhouse than there were a year ago.”

He added: “Brexit uncertainty means we can’t know what twists and turns politics and economics will take during the rest of 2019, but it is encouraging to see the strength and optimism in the Northern Powerhouse economy shining through.”

Richard Carter, managing director of BASF, UK and Ireland, based in Cheadle, said: “The outlook for our customer industries, and therefore for us, is currently clouded by unprecedented uncertainty.

“However, where there are challenges there are also huge opportunities and innovation is key. The North is well positioned to benefit from this.

He added: “Enterprise partnerships must work effectively with each other to help the North to fulfil its potential: silo thinking is yesterday, collaboration is the model of today.”

Emma Degg, chief executive at the North West Business Leadership Team, said: “The fact that businesses in the North remain on a growth footing, with improved order books this spring, is not just good news for this part of the UK.

“The country’s exporting ambitions – regardless of Brexit outcomes – rely on securing continued growth ‘up North’.

“The recent boost in economic activity is, of course, partly due to stockpiling from business contingency planning, and it would be imprudent to gloss over this.

“If current growth is to continue, renewed efforts must be made across all sectors to invest in the things that will secure the continued competitiveness of businesses in an uncertain global market place.

“For us perhaps the most positive message in the report is that respondents regard investment in new technology as a key focus for the future.”

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