REGIONAL GROWTH ACROSS THE EAST MIDLANDS
NATIONAL CONTEXT
- GDP grew by 0.7 per cent in the third quarter of 2014 – and by 3.0 per cent compared to the same quarter a year ago.
- This is slightly down from the 0.9 per cent increase in Q2 2014 on a Quarter-on-Quarter basis, although the fall of 0.2ppts is well within the usual volatility that we see in the quarterly figure.
- It means the UK is now 3.4ppts above the pre-crisis peak (in Q1 2008), after the great recession shrank the economy by 6.0 per cent.
- The growth is balanced, with all four major sectors of the economy showing uplift: Manufacturing (0.4%); Services (0.7%); Construction (0.8%); Agriculture (0.3%).
- On an annual basis, for the second quarter in a row, the three largest sectors of the economy – Services, Manufacturing and Construction (making up 95.5% of the economy) – each grew by three percent or more. Prior to the last quarter, the last time all three sectors grew by three percent or more, on the year, was in Q1 (versus Q1 1999).
Chancellor of the Exchequer George Osborne said:
“Today’s strong growth figures show that the UK continues to lead the pack in an increasingly uncertain global economy. With all the main sectors of the economy growing it’s clear that our recovery is broadly based. But the UK is not immune to weakness in the euro area and instability in global markets, so we face a critical moment for our economy. If we want to avoid a return to the chaos and instability of the past then we need to carry on working through our economic plan that is delivering stability and security.”
Chief Secretary to the Treasury, Danny Alexander, added:
“Our recovery is now well established and creating jobs in record numbers. These figures show the UK economy has good momentum to deal with a less certain global outlook. Our plan is working and we need to stick to it. Combined with strengthening business investment and rising employment this GDP figure is further evidence that we are building a stronger economy, which is the only basis for sustainable rises in living standards and the only foundation for a fairer society.“
REGIONAL REACTION
Trevor Palmer, director of Tank PR:
“I started my PR consultancy in 2010 and we turned over under £100,000 in the first year of trading with two employees. We now have 11 members of staff and look set to exceed £1 million turnover in 2015.
“The recovery of the region has played its part in this growth. Roughly 60 per cent of our clients are East Midlands based, with many in the services sector. I believe that a healthy services sector is a good barometer of an improving regional economy.
“The downturn created a lot of opportunity for businesses like mine, as the balance of power amongst PR and marketing agencies changed with the reduction in the availability of public sector work. We were lucky in that our initial specialism was working with dynamic SME’s – a segment of the economy that has thrived post-recession.
“Also key to our successes is the abundance of great expertise in the region, and we have worked with excellent business coaches through Pera Consulting and the GrowthAccelerator service. Indirectly this has also provided us with opportunities in San Diego, so who knows what may be around the corner?”
Langley Mill-based GEM Vending, an independently-owned supplier of vending services to private and public sector organisations across the greater East Midlands. With a turnover of over £5.5 million, the company has recently won the UK-distribution rights for a leading US branded hot drinks system.
Steven Gallagher, managing director said: “We are seeing encouragingly high sales volumes from smaller independent retailers, offices and workshops, and I put this down to companies looking for an additional income stream as well as a slight competitive edge. On the back of this, we are recruiting for both sales and administration posts.”
Quadrant Events, Nottingham. A successful management buyout in 2012 has provided event production company Quadrant Events with the perfect platform for growth in the East Midlands and across the UK. With its head office in Nottingham, the company is set to achieve a 12 per cent increase in turnover this financial year with strong underlying profit growth.
Andy Hogben, managing director of Quadrant Events said:
“It is now apparent that the management buyout and subsequent restructuring we started three years ago have positioned us well to build on the recent economic uplift in productivity. Turnover has reached over £2 million and our UK sales trends are encouraging. We look set to add a further 25 per cent to turnover by 2017.”
Ursula Lidbetter, Chair of the Greater Lincolnshire LEP, said:
“We conducted a major survey recently and found that nearly two-thirds of Greater Lincolnshire businesses were reporting improved performance over the past year.
“What’s more, almost three-quarters said they expect their business to grow in the next 12 months.
“27% of all Greater Lincolnshire employers expect to increase their number of staff over the next year compared with just 3% who don’t.
“These are clearly optimistic signs and while there are still challenges ahead, 70% of employers in our priority sectors say Greater Lincolnshire is a place where their business can grow.”
Ron Lynch, Regional Director for the Institute of Directors said:
“The East Midlands economy continues to perform well and there are welcome signs that productivity is still rising. The challenge now is to ensure that economic growth is felt in people’s pockets so that consumer confidence increases.”
Simon Gray, Chief Executive of Nottingham Means Business (NMB), an influential business led organisation which works with Nottingham City Council to support and encourage investment in the city and county said:
“We represent a number of businesses across Nottingham and Nottinghamshire and from discussions with business owners it’s clear that the economic temperature of the UK has risen and the recovery is well underway. Local businesses appear to be back to pre-financial crisis levels and are revealing increased positivity surrounding investment decisions, recruitment and future growth expectations.”
John Forkin, Managing Director, Marketing Derby said:
“With its emphasis on design, production and export, the region continues to punch its weight in helping rebalance the economy.
“In Derby, we have seen growth in hi-tech SMEs in sectors such as rail, aerospace, composites and software, attracted by the workforce cluster around Bombardier, Rolls-Royce and Toyota”.
David Ralph, Chief Executive of D2N2, the Local Enterprise Partnership for Derbyshire and Nottinghamshire, said:
“This year has seen continued signs of the economy moving in the right direction and, as a result, confidence has risen among businesses.
“There has been positive news this month with the extension of Regional Growth Fund (RGF) money to the D2N2 area, through the University of Derby securing almost £16.5m of Government funding to help grow firms in our area, now being made available.
“Our own RGF pot, which has been topped up by European Regional Development Fund money, continues to help local businesses grow through the Unlocking Investment for Growth programme. Since launching last year, businesses from across Derbyshire and Nottinghamshire have seen the benefits, with the programme approving £3.2 million in grant funding which will create more than 300 jobs.
“Further applications at an advanced stage are requesting in excess of £1.6m and expect to create an additional 200 jobs, with Chalice Medical in Worksop a recent announcement, with a near £500,000 grant from us helping to create 28 new jobs. This is the largest grant awarded to date from our grant programme.
“But while there continues to be positive signs in a growing economy, the recent EU slowdown and global issues mean we must remain vigilant as we move forward and nothing can ever be taken for granted.
“For D2N2 to be successful in driving economic growth, local businesses and stakeholders must engage with us. We have to continue to make strides in the right direction and while that is happening, our ambition has to be, and will be, to make sure we are exceeding our potential.”