Barclays report: Mid-sized firms set to take up growth baton
A HOST of surveys and reports since the turn of the year show that businesses in the North West are feeling the benefits of the burgeoning economic recovery.
Indeed, the North West has seen its unemployment rate fall to 8.1% over the last year – lower than London,according to the Office for National Statistics.
In January, the Institute of Chartered Accountants in England & Wales (ICAEW) and Grant Thornton’s UK Business Confidence Monitor found confidence in the region has been on a general upward trend for the past two years, with businesses in the North West reporting an increase in turnover through 2013 of 4.9%.
Click here to download Driving the Growth of the North West economy , a report produced by TheBusinessDesk.com for Barclays.
This week, PMI data and BDO’s Business Trend’s survey painted a healthy picture of burgeoning confidence, exports and job creation among regional manufacturers.
Michael Hartig, Co-Head of Northern region at Barclays, says the recovery has largely been consumer led to date – as evidenced by strong UK sales in the automotive sector and improvements in the property market – but believes the continued recovery will now be led by business.
“We can achieve an export-led, continued recovery – consumers kick-started that and now it is time for business to take over that mantle with exports,” he says.
However, Mr Hartig remains cautious and says that exporting has a long lead time: “You need to do it for 12 to 18 months before you start seeing the payback,” he explains.
For leading business group CBI the “unsung heroes” of the improved economy are medium-sized businesses, which have contributing to
jobs and growth across the regon and the country.
The North West has the highest number of medium-sized businesses – firms employing 50 to 499 people with a turnover of between £10m and £100m – outside of London and the South East. Despite only representing 1.9% of firms, these 4,000 businesses employ more than
490,000 people locally (19.5% of the workforce) and create 28% of private sector revenue.
The economic contribution of MSBs to the North West increased by £4bn between March 2010 and March 2013, the CBI says, and they now contribute £23bn gross value added (GVA) to the economy, on the back of strong revenue growth of 26% during the last three years.
Damian Waters, CBI North West director, says: “These businesses are optimistic about the economy and with a small helping hand from the government their future growth potential could be even greater.
“With better access to a range of growth finance options, improved training, research support and help to break into new exports markets, they could be worth an extra £20bn to the UK economy by 2020.”
