During the recession, businesses in the regions found conditions more challenging than those in London and the South East. However, as economic recovery continues to build momentum, these same businesses are enjoying the fastest pace of growth in the UK according to a leading business firm.
Growth in the North of England has been particularly strong, with accountancy firm PriceWaterhouseCoopers (PWC) posting double digit growth in some locations.
PWC Chairman, Ian Powell, believes that the manufacturing and retail sectors are leading the way in the Northern recovery.
He says; “UK regions are growing, with the North performing particularly strongly, and from our experience, the retail and manufacturing sectors being most active.
“Manufacturing and speciality engineering are undoubtedly enjoying a resurgence in Yorkshire and the North East.
“Onshoring processes which had previously been taken offshore, investing in capital and skills training – including apprenticeships – and a focus on exports are all features we are seeing.”
The claims made by PWC are backed up by data from the latest Lloyds Bank Commercial Banking Regional Purchasing Managers’ Index, which showed a marked lift in activity in all regions during the last quarter of 2013.
The West Midlands and the North were particularly highlighted as key growth zones, with record private sector activity occurring in the West Midlands and a 49 month high in private sector growth rates recorded in the North.
As a result, an average reading of 61.0 was recorded for the period from the beginning in October and ending in December. With a reading of 50.0 or above equating to growth, the latest reading demonstrates an impressive turnaround in fortune for UK businesses.
Yet managing director of regional development consultancy Mickledore, Nigel Wilcock, believes that still more must be done in order to balance regional growth to achieve a stable recovery. He points out that, although Manchester, Newcastle and Leeds are performing incredibly well, this success has not yet been recorded in secondary Northern locations such as Middlesborough, Burnley and Blackburn.
He continues; “Many businesses are realising that lower salary and property costs outside of the City mean that businesses can achieve the same output but with a higher margin, whilst in addition the skills for many of the new infrastructure projects such as offshore marine, nuclear power, a resurgence in oil and gas and large transport projects are all found in the UK regions.
“A wider distribution of economic growth has got to be achieved to increase the attractiveness of the region to employees if the pressure on public services, housing and infrastructure in the South East is to be relieved.”
How do you think businesses in secondary locations could achieve similar results to those in Manchester, Leeds and Newcastle?
