Business News Round Up (17/05/2022)
New economic report highlights mixed fortunes for Scottish cities over next two years
A new economic report places Edinburgh in the top ten best performing cities for economic output and employment by the end of 2023 but reveals mixed fortunes ahead for Aberdeen and Glasgow. According to Irwin Mitchell’s latest UK Powerhouse report, produced by the Centre for Economics and Business Research (Cebr), Edinburgh will rise from being among the bottom five cities in the UK for economic output in Q4 2021, to 8th place by Q4 2023, with a 2.2% year-on-year increase in GVA (Gross Value Added (the total value of goods and services produced)). This equates to £900m of growth and takes the total size of the economy to £23.2 billon. A more modest increase in employment will see Edinburgh move from 13th place in Q4 2021 to 9th in Q4 2023, with 2% year-on-year growth set to deliver 14,000 new jobs. Edinburgh’s strong recovery next year is in marked contrast to Aberdeen. According to the report, the Granite City was the best performing Scottish city in Q4 2021 but by Q4 2023, it had moved to bottom place for economic output and year-on-year employment growth of just 1.2%. Glasgow delivers the more consistent performance of the Scottish cities in the study’s league tables, moving up 12 places to 21st for economic output in Q4 2023 and a modest improvement in employment seeing the city move up one place to 17th in 2023, creating 12,300 new jobs.
Cautious start to year for dealmaking sector
The mergers and acquisitions (M&A) market in the North West has experienced a cautious start to 2022, with a drop in the number of transactions, according to a new report which also detailed the most active advisers. Experian MarketIQ’s M&A Review for Q1 found there were 41 per cent fewer North West transactions announced in the first quarter – a total of 174 transactions compared to the 295 recorded in Q1 2021. The change from Q1 2020 and Q1 2019 represented a less stark decline of about 20 per cent, however. The total value of North West deals increased by 9.6 per cent in Q1, up from £3.7bn to £4.1bn. This was largely due to Unilever’s massive share buy-back announced near the end of March, valued at almost £2.5bn. Looking at the type of deals being made in the North West, the report found that acquisitions are soaring ahead with a total of 128 transactions – representing 74 per cent of all deals in the region – with relatively little private equity activity compared with the wider UK. This statistic was reflected in the top ten deals in the area, where eight out of the ten were acquisitions. Among the notable transactions was TI Midwood & Company in Chester being acquired for £54m by Sweden-based Bufab Holding, while there were two publicly-listed North West purchasers in the first quarter.
https://www.insidermedia.com/news/north-west/cautious-start-to-year-for-dealmaking-sector
Scotland’s unemployment rate falls to record low
Unemployment in Scotland fell to a record low in the last quarter, according to the latest Office for National Statistics (ONS) figures. The unemployment rate for those aged 16 and over between January and March this year was 3.2% – 0.9% down on the previous quarter. Across the UK, the unemployment rate for that age group was 3.7%. The employment rate for those aged 16 to 64 years rose to 75.6% north of the border – 1.4% up on the previous quarter. In Scotland, there were 2.682 million people aged 16 and over in employment between January and March this year, with 88,000 in that age group unemployed. Employment minister Richard Lochhead pointed out that separate HM Revenue & Customs early estimates show 2.42 million pay rolled employees in Scotland in April, 29,000 more than in February 2020, prior to the pandemic. “While we continue to face economic challenges, with the rising cost of living, the negative effects of Brexit and the economic impacts of Russia’s illegal invasion of Ukraine, the Scottish Government remains committed to doing all we can to help our economy recover.
https://www.insider.co.uk/news/scotlands-unemployment-rate-falls-record-26983389
Greater Manchester economy to grow by £1.9bn and create almost 28,000 jobs
The Greater Manchester economy is forecast to grow to almost £71bn by the end of 2023, and almost 28,000 jobs will be created, according to a new economic report by law firm Irwin Mitchell. However, it also warns that the levelling up agenda will stall unless more Foreign Direct Investment (FDI) is attracted to the region. Irwin Mitchell’s UK Powerhouse report, produced by the Centre for Economics and Business Research (Cebr), forecasts that the value of Greater Manchester’s economy will be £1.9bn larger and the region will employ 27,700 more people by the end of 2023 compared to the fourth quarter of 2021. But the report also cautions that other Northern cities will not be so vibrant. Economic growth in Northern cities is expected to be exceeded by that of Southern counterparts and the study says the South or East of England will, by the end of next year, be home to eight of the top 10 fastest growing cities. Significantly, out of the 50 locations included in the study, more than half of the slowest growing economies are expected to be in the North of England. Highlighting the strengths and the potential of Manchester, the report says Greater Manchester’s economic success has been borne out of diversifying from traditional industries into new markets.