Business News Round Up (09/01/2023)
UK becoming less attractive for investment, manufacturers warn
Britain has become less competitive and less attractive to foreign investors as a result of soaring energy costs and recent political turmoil, manufacturers said in an industry survey released on Monday. The proportion of manufacturers who think Britain is a competitive location halved to 31% from 63% a year ago, and 43% said Britain had become less attractive to overseas investors, according to the survey by Make UK, the main trade body for British manufacturers, and accountants PwC. The survey of 235 businesses took place from Nov. 1 to Nov. 22, when the turmoil of Liz Truss’s short-lived government was fresh in people’s minds, and 53% of firms said ongoing political instability had damaged business confidence. This week finance minister Jeremy Hunt is due to outline plans to sharply scale back energy subsidies for businesses. Make UK said the plans are likely to lead to exacerbate cuts to jobs and production that were already in the pipeline. When the survey took place in November, two thirds of manufacturers expected to reduce headcount or cut output because of high energy costs.
Quarter of Scots thinking of launching own business in 2023
New data from Virgin StartUp, a not-for-profit organisation which helps budding founders start or grow their new business, predicts that Friday 6 January 2023 will see a surge of interest from Brits who want to start their own business, with a quarter of Scottish adults considering launching their own business in the coming year. Virgin StartUp has coined the day ‘Founder Friday’, as data shows the first Friday in January is a peak time for new entrepreneurs to begin their start-up journey. To support new founders, Virgin StartUp has opened a free business support line on Founder Friday where anyone can book a 30-minute slot with an experienced business advisor. For the past two years, Virgin StartUp has seen a spike in traffic to its website on the first Friday of January, as well as a significant increase in applications for Start Up Loans across the first month of the year, as future founders set their intentions for the year ahead and decide to turn their passions into a business. The experts, who have helped over 4,500 founders start and grow the businesses, will be on hand to answer any questions the nation’s budding entrepreneurs might have; whether it’s how to create a cashflow forecast, the best way to test your idea, or how to market your start-up on a budget, they’re available for a free 30 minute call to talk through any concerns and help Brits take their first steps on their business journey.
UK companies ‘consider redundancies’ amid business pessimism
Recruitment plans among British businesses have dipped to their lowest in two years because of market pessimism and low confidence, an influential report has found. Hiring plans are being paused by companies that are considering redundancies to manage rising costs, accounting, and advisory firm BDO said in its analysis of more than 4,000 businesses surveyed across different sectors. A significant drop in optimism and productivity in November was followed by a very slight rise in December, remaining well below historic levels. BDO uses employment, inflation, optimism, and productivity indexes for an overall picture of business sentiment. A score above 95 represents growth, and anything below is considered a contraction. In the latest report, business productivity and optimism were both given scores below 92, putting them firmly in negative territory. They were partly dragged down by declining manufacturing output, as global supply chain disruption has made it harder for companies to get hold of important materials, and energy prices have risen sharply. The services sector was a welcome bright spot with productivity increasing fractionally since the last report, indicating that consumers were more active over the typically busier Christmas period. Meanwhile, the employment index was scored just under 111 points, but it represents the weakest reading since January 2022.
Spin-outs backed to commercialise projects
University projects from Edinburgh and Aberdeen have each received £75,000 from Scottish Enterprise’s High Growth Spin-out Programme (HGSP) to support renewable energy. Edinburgh’s marine heat exchange project, called Seawarm, has received support alongside Aberdeen’s project LCDC that is developing a direct current circuit breaker system for renewable energy projects. Professor Christopher McDermott of the School of Geosciences at the University of Edinburgh said: “We are grateful for the funding from Scottish Enterprise, which will allow us to test at sites facilitated by Lar Housing Trust and potentially others in the Firth of Forth. Coastal communities make up 41% of Scotland’s population, so we hope to be able to meet growing demand for resilient, reliable, and renewable energy sources. Our invention has the potential to decarbonise heat, helping us on our way to net zero.” The Aberdeen project has been developed by Professor Dragan Jovcic from the University’s School of Engineering. He is working with Royal Society Entrepreneur in Residence Paddy Collins to develop a spin out company to commercialise the LCDC CB, which may also contribute to the wider push for electrification in many industries as well as enabling large-scale green hydrogen generation.