COMMENT: 2012 – a curate’s egg

Good in parts, pretty awful in others.

It might sound like the pre-Christmas weather forecast but it’s a way of summing up the regional economy in 2012.

The West Midlands economy can’t be considered without thinking of the national and international picture of course. This is even more the case these days with the continued problems in the Eurozone causing problems for local exporters.

But we’re nothing if not adaptable in this part of the world and many of the best stories we have featured this year have been about firms winning major international contracts in the BRIC economies and beyond.

The big players – Jaguar Land Rover, JCB and Carillion, for example – are leading the way but the export success story is in no way limited to large corporates.

Many SMEs have realised that there is a real demand for quality, British-made products and have moved into the international arena, often to great effect.

The other good news to come out this year has largely related to infrastructure development. New Street Station and Midland Metro have taken huge steps forward, the Birmingham Airport runway extension is happening and the HS2 project seems to be gathering momentum.

Apologies for sounding Birmingham-centric here but I take the view that a successful Second City will have a hugely positive knock on effect for the rest of the region.

And we need that to happen because there are still big problems in the regional economy. Unemployment is frighteningly high, especially amongst the young, and skills levels are woefully low.

We are promoting advanced, high-tech, value-added businesses to replace the manufacturing industries that have disappeared and while this seems to be a good strategy it doesn’t seem to create a vast number of jobs.

Inward investment has slowed down to a trickle and sectors such as retail and property are showing few signs of rude health. Insolvencies may be down in number but we seem to have carried high-profiles stories about firms going into administration and the resultant job losses most weeks of the year.

The Government is to be congratulated for launching a number of initiatives to get funding out to SMEs and to bankroll infrastructure development to stimulate the economy but the reality is that – against a backdrop of huge public sector cutbacks – a lot more of this type of action will need to be taken before we start to see meaningful results.

But while Christmas is a time for looking back at the year that has been it is also a chance to look forward to the New Year and we have got a lot to be optimistic about in this part of the world.

The momentum behind the infrastructure projects I’ve already mentioned and new ones coming on track should stimulate sectors such as commercial property and construction.

There is a lack of confidence out there at the moment that has left a lot of people sitting on their hands. Once things start moving in the right direction that confidence will start to come back and decision-making in one sector quickly has a positive impact in others.

As I said at the outset, we are dependent on sustained good news coming out nationally and internationally but when that good news does start to filter through the West Midlands is well placed to take advantage.

As the Christmas celebrations get underway, TheBusinessDesk.com would like to say thank you for your support in 2012.

Over the festive season we will continue to bring you the latest business news on every working day and look out for our Review of the Year.

And in the New Year we will be publishing the results of our State of the Region survey, revealing your assessment of the region’s economy and prospects for the months ahead.

We are also looking forward to telling you about lots of exciting developments at TheBusinessDesk.com as we get further into 2013.

Merry Christmas!

Andy Coyne

Editor

TheBusinessDesk.com