Business News Round Up (15/04/2024)
Goldman Sachs finds North West region best in class at growing small businesses
The North West is among the best places in the UK for small businesses to achieve high growth, according to new research from the Goldman Sachs 10,000 Small Businesses UK programme. Over the past 20 years, the region has seen a 212% increase in ‘productivity heroes’; fast growing small companies able to create jobs and simultaneously achieve productivity growth. Analysis by the Enterprise Research Centre at Aston University finds that the number of productivity heroes in the North West has grown at a faster rate than any other region in the country, including London. In 2021/2022, there were 3,747 productivity heroes in the North West region, 2,500 more than in 2000/2001. Productivity heroes play a critical role in driving productivity in the North West economy, employing more than 60,000 people and generating more than £10bn in annual turnover.
Services sector provides ‘lopsided’ lift in output
Private sector output expanded for a third consecutive month in March though it has been “lopsided” in favour of the service sector. The Royal Bank of Scotland’s purchasing managers index for the manufacturing and service sectors rose in Scotland from 52.1 in February to 53.6. It indicated the most pronounced expansion in 11 months with only London and Northern Ireland recording stronger rates of growth. However, underlying data noted a continued divergence between the two sub-sectors. While business activity rose across service providers at the sharpest pace since June 2022, the downturn in manufacturing production entered its ninth successive month and deepened since February. The latest data indicated that confidence levels at Scottish private sector companies rose for the second consecutive month to a 13-month high. The positive year-ahead outlook was spurred by plans of increased investment and advertising, as well as hopes of improving underlying demand conditions.
https://dailybusinessgroup.co.uk/2024/04/service-sector-provides-lopsided-lift-in-output/
Report reveals ‘true impact’ of manufacturing is nearly a quarter of UK GDP
Manufacturing is having a greater impact on the UK economy than first thought according to a new report. ‘The True Impact of UK Manufacturing’ shows industry is worth £518bn and supports 7.3million UK jobs directly and across the supply chains/communities it operates in. This represents 23% of total GDP, far bigger than the direct contribution of 8.2% that is usually quoted by economists. Carried out by Oxford Economics and the Manufacturing Technologies Association (MTA), the report also shows that ‘making things’ accounts for 34.5% of all UK goods and services exports, whilst the median wage is £31,300, 11% higher than the national median wage. The findings are even more impressive when you consider the sector has had to navigate a myriad of challenges outside its control in recent years, including changing relations with the EU, the Covid-19 pandemic, increases in energy costs and global supply chain fragility and international conflicts.
Business activity continues rising across North West private sector in March
The North West private sector experienced a positive end to the first quarter, the latest Regional PMI figures reveal. Firms in the region reported a sustained upturn in business activity, while employment in the region also ticked up, albeit only marginally, as demand showed further signs of strengthening and business confidence reached the highest for over a year. Price pressures, meanwhile, eased and were among the lowest seen across the UK. The headline North West PMI Business Activity Index registered a second successive reading of 52.7 in March, signalling further moderate growth of regional output. It was broadly in line with the average for the UK as a whole (52.8). Demand conditions continued to improve across the North West during March, as highlighted by a third straight monthly rise in inflows of new business.