Business News Round Up (31/01/2023)

IMF raises global growth forecast but UK set to shrink

The International Monetary Fund has raised its forecasts for the global economy for 2023, stating that growth has been “surprisingly resilient”.However, it also said the UK is likely to be the only leading economy to head into recession in 2023. The IMF said it expects the global economy to grow 2.9% in 2022, a 0.2 percentage point increase from the last forecast, published in October. It expects growth to “rebound” in 2024 to 3.1%. “Economic growth proved surprisingly resilient in the third quarter of last year, with strong labor markets, robust household consumption and business investment, and better-than-expected adaptation to the energy crisis in Europe,” said Pierre-Olivier Gourinchas, the chief economist. He noted the boost that has come from China’s “sudden re-opening” and added that the nation and India combine to account for half of the global growth this year. The US and the Euro area will account for just a tenth. While the January update proved positive for most economies, the UK was singled out, with the fund saying it will shrink and perform worse than other advanced economies. The IMF predicted the UK will contract by 0.6% in 2023, a 0.9 percentage point drop from October’s figure.

https://www.investmentweek.co.uk/news/4066330/imf-raises-global-growth-forecast-uk-set-shrink

Scotland’s unemployment rate ‘should be four times higher than figures suggest’

Scotland’s low unemployment rate does not include more than 350,000 people who are involuntarily out of work but classed as economically inactive, according to the Centre for Cities. The urban policy research unit’s annual economic assessment argues that while official figures currently show Scotland’s jobseeker rate at 3.6%, the actual ‘hidden’ unemployment rate is more than four times higher at 14.9%. This is because the official rate only includes those who are actively looking for employment and does not measure people who are neither in work, nor looking for a job, due to circumstances outside of their control. Dundee has Scotland’s highest hidden unemployment rate at 16.3%, followed by Glasgow at 16.1% and Aberdeen at 15.6%. Edinburgh, which is one of the UK’s best performing cities, has a much lower hidden rate at 9.1%, but this is still more than three times its official unemployment rate. The hidden unemployment rate also clearly shows how the ongoing inactivity crisis is deepening regional divides across Britain, according to Centre for Cities. While nearly every city and large town in Scotland has a rate higher than the national average, all but three of the UK’s 13 urban areas with below average rates are in the south of England. Overall, cities across Scotland are experiencing a job shortage: they account for 3.1% of all job postings, but 3.3% of all hidden unemployed in the UK.

https://www.insider.co.uk/news/scotlands-unemployment-rate-should-four-29085137

Three years on and 45% say Brexit is going worse than expected

A new poll by Ipsos, conducted three years on since Britain formally left the European Union, finds 45% think that Brexit is going worse than they expected, up from 28% in June 2021. This includes two in three (66%) 2016 Remain voters saying it has gone worse (+19 since June 2021), and one in four (26%) 2016 Leave voters thinking the same (+16). Almost one in ten (9%) say it is working out better than expected (-6), while two in five (39%) think it is meeting their expectations (-7). Figures are similar when asked the impact Brexit has had on their daily life. Some 45% think leaving the EU has made it worse (unchanged since June 2022), against 37% stating it has made no difference (+3), and one in ten (11%) saying it has bettered their lives (-6). When asked what the negative outcomes of Brexit are, increased barriers to trade between the UK and EU comes out on top, mentioned by two in five (40%), up 13 percentage points since last asked in March 2021. This is followed by three in ten saying the end of freedom of movement (30%, +5), and one in four citing less international cooperation between the UK and EU (26%, +7). On the other hand, when asked about the positive outcomes, just over one in five either mention Britain gaining control over its laws and regulations (23%, unchanged), being able to respond to the Covid-19 pandemic better (22%, +1) or Britain being able to make its own decisions generally (21%, unchanged). However, around equal to this was one in four (24%) saying there are no positive outcomes (+4).

https://www.ipsos.com/en-uk/three-years-and-45-percent-britons-say-brexit-going-worse-expected

Northern regions unit to fight cyber crime

Cyber security experts from across the three key regions of the North have joined forces to tackle the lack of investment and development in the regional cyber security landscape. With a mission to facilitate and level up the divide, three cyber security clusters – the North East’s CyberNorth, North West Cyber Security Cluster and Yorkshire Cyber Security Cluster – have come together with national body UKC3 in commissioning the Northern Cyber Clusters Collaboration project, with the aim to better understand cyber security assets and key cyber security players in the Northern regions, and to develop ways for them to work together to increase visibility and to elevate growth and opportunities in the sector. Cyber security is a necessity across every business and the high-growth sector is on an upward trajectory with annual cyber security revenue in the UK now estimated at a huge £10.1 billion, an increase of 14 per cent in the last year alone. However, when it comes to the North/South divide the statistics are a cybercrime in themselves. The projects founders cite statistics which show annual cyber security investment in the southern regions accumulated to £982.4m. By contrast, the North received just £8m of investment.

https://www.prolificnorth.co.uk/news/tech-news/2023/01/northern-regions-unite-fight-cyber-crime