Having already put forward the case for the continued dominance of London and the South East, today Aldermore looks ahead to ask whether prospects are brightening for businesses in the North?
While data from the Office for National Statistics confirms that London continues to lead in terms of gross value added per person, confidence is growing amongst Northern businesses.
“The numbers will tell you that things are a little bit hotter in parts of the south, you know rates of unemployment are a little bit lower there than they are up here but, nonetheless in terms of the pace of pick up, it’s not too dissimilar actually,” stated Bank of England Chief Economist Andrew Haldane, discussing the North-South divide with Scarborough News.
In fact, the Federation of Small Business’ latest Voice of Small Business Index reveals that sixty per cent of North-East SMEs are confident of improving prospects in the next three months, the highest of any UK region.
This figure has more than doubled since the same time last year, echoing findings from the North East Chamber of Commerce’s recent quarterly economic survey. NECC reports the most promising results from the survey since its inception in 1995, based on a number of indices including growth, export behaviour, hiring activity and investment intentions.
“The slow but steady growth throughout 2013 has provided the momentum for an excellent first half of 2014, which is seeing rising optimism across the region reflected in future plans for recruitment and business investment,” attests NECC policy and research manager, Mark Stephenson.
In contrast with this promising picture, findings in the North West appear offer a more mixed forecast. The region was one of the least confident in the FSB’s Index, second only to Wales, though at 30 per cent, the number of SMEs expressing optimism has tripled within a year. On a local level, a Centre for Cities report shows that while some areas of the North West are flourishing, others lag behind. Warrington, for example, emerged as the UK city with the highest proportion of expanding SMEs, though Rochdale ranked last on the same scale.
Perhaps though, planned government investment could turn fortunes around for the region, with the proposed HS3 railway development looking to create stronger business ties between Leeds and Manchester to develop a ‘Northern powerhouse’.
Despite this ambitious plan, BCC Executive Director of Policy Adam Marshall suggests still more could be done to better connect cities in the North and boost opportunities for local SMEs, stating:
“The prospect of a high-speed east-west rail link across the North is a good start if it materialises, but we would like to see more thought given towards connecting all the core cities in the north, not just Manchester and Leeds.
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