Business News Round Up (21/06/2021)
Tourism and recreation led UK recovery in May: Lloyds Survey
The U.K.’s economic recovery accelerated in May, led by the tourism and recreation segment, according to a survey by Lloyds Bank PLC that tracks business activity. Tourism and recreation recorded the sharpest rise in output growth (to 62.4 in May from 51.9 in April, in the bank’s U.K. Recovery Tracker) as British hotels, pubs and restaurants experienced a release of pent-up consumer demand, with the transportation sector following. As the U.K. moved further out of lockdown, 11 out of 14 U.K. sectors tracked by the survey reported faster output growth month-on-month in May, up from nine in April, according to Lloyds. All 14 reported employment growth in May, up from 12 in April, with tourism and recreation showing a net gain for the first time since January 2020.
UK remains Europe’s most attractive destination for financial services investment
The UK continues to be Europe’s most attractive location for international investment into financial services, according to EY’s latestUK Attractiveness Survey for Financial Services, attracting 56 projects in 2020. However, this was 43 projects lower than in 2019 and the gap with the second largest recipient of investment – now France – has narrowed. In 2019, the UK recorded 99 projects, more than double the financial services projects than second placed country, Germany, which registered 43 projects. In 2020, however, the UK’s lead has narrowed to 14%, with France overtaking Germany for second place by securing 49 projects. In contrast to the overall European trend of falling financial services FDI projects (23%), France saw its number of investment projects increase by 11 (a rise of 29%).
Survey reveals how Scottish start-ups have fared throughout the pandemic
The Scottish Start-up Survey 2021, run by the Engage Invest Exploit (EIE) team at the University of Edinburgh’s Bayes Centre, has revealed how Scottish start-ups have been faring throughout the pandemic. 75 start-ups drawn from EIE alumnus companies – EIE has supported over 500 tech start-ups since 2008 who have collectively raised over $1 billion from seed through to Series A and later stage funding – and other start-ups from across Scotland were interviewed on topics ranging from growth prospects, the investment backdrop, government support, hiring, plans to return to the office, and wellbeing and mental health. 68% of start-ups said they grew during the pandemic, with only 11% saying they contracted. 72% of respondents said they expect their company to come out of the pandemic in a stronger position, with only 7% answering in the negative, and 21% saying they were unsure. 59% of start-up founders said their company had to pivot in the wake of the pandemic.
Scotland retains status with financial services investors
Scotland has retained its decade-long trend as the UK’s most attractive region for financial services foreign direct investment (FDI) outside of London. Although the UK – and Europe as a whole – recorded fewer projects in 2020 than the year prior, the UK, supported by Scotland, continues to be the most attractive European market for global FDI. The UK attracted 56 financial services (FS) projects in 2020, representing a 43%year on year fall, and resulting in the gap with the second largest recipient of investment – now France – narrowing. Of the 56 projects, six were located in Scotland (two fewer than in 2019), according to EY’s latestUK Attractiveness Survey for Financial Services. While the Scottish financial services market recorded a decline in FS projects in 2020, it was a smaller fall than that of the UK. Edinburgh is the UK’s top city for total FDI outside London (in line with the data for overall inward investment). It recorded three FS projects in 2020 while Glasgow, now in the top ten most attractive cities in Europe (as per EY UK Attractiveness Survey), also recorded three FS projects.