Booming Brum: Read all about it, bumper edition…
From Birmingham to London’s Lancaster House; from Qatar to Davos, it seems as if some invisible force decreed it would be Economy Week. With the release of official data and heavyweight reports as well as the PM’s ‘big’ Brexit speech it’s been like one of those official sounding theme ‘Weeks’ manufactured by PR types (yes, yes I know…).
First off was news, initially reported in The Sunday Times, that Birmingham has retained is status as the “start up capital” of Britain.
Birmingham is home to more start-ups than any other UK regional city, with 17,473 new companies registered in 2016, an increase of 25% on the previous year and more than any other city outside the capital.
The city’s business growth rate is higher than all UK cities, enabling Birmingham to claim it is the most entrepreneurial UK city outside London, based on data released by StartUp Britain.
Birmingham has retained its number one position for four consecutive years. The number of new businesses is almost double that of Manchester’s, with 9,416 companies registered during 2016, whilst Glasgow is third with 7,845.
Birmingham also beat London to become the country’s leading city for business growth rates in 2016, according to the Office for National Statistics’ (ONS) business counts data.
Neil Rami, Chief Executive of inward investment agency Marketing Birmingham, said:
Birmingham has simultaneously outpaced the capital city to become the UK’s leading destination for business growth, and is the UK’s number one regional destination for start-up creation. The city’s young, talented workforce, newly developed infrastructure, and range of incubator and accelerator programmes, has fostered a strong ecosystem that fuels a culture of innovation.
Start-ups and SME’s are crucial to the long-term health of our local and national economy.
Steve Hollis, Chairman of the Greater Birmingham and Solihull Local Enterprise Partnership (GBSLEP), added:
These figures are testament to Birmingham’s entrepreneurial spirit and its ability to attract, foster and grow early-stage businesses.
Start-ups come – and stay – in Birmingham…. [partly] because of the skilled people they can employ, the cost efficiencies of being based here and the ecosystem of small to medium enterprises here.
There is nothing like the support of peers, particularly those who are further ahead in the journey than you are.
Meanwhile, it was revealed that inflation reached its highest point in two and a half years as the sharp decline in the value of sterling led to price increases.
Inflation was up to 1.6% in December from 1.2% in the previous month, the highest since July 2014.
Unemployment remains a major issue for Birmingham, with four of the top five UK parliamentary constituencies recording the biggest proportion of unemployed to be found in this city.
Unemployment decreased in the West Midlands based on the previous quarter (June to August 2016), but was up based on the same period last year. The North East has the highest unemployment rate.
At the end of last week it was announced that Councillor Clancy was jetting off to the “oil rich” state of Qatar, home to the 2022 World Cup, to “bang the drum for Brum” (note to Press Secretary: new cliché required, he’s sounding like Baron Whitby – love Ed). This is, of course, the former backbencher who was among the first to criticise previous council leaders for jetting off on foreign junkets and focussing too much on shiny capital projects in the city centre.
An excited council press release said Councillor Clancy hailed the trade mission as a “significant step” in the “battle” to unlock millions of pounds worth of investment in a “post-Brexit landscape.”
His trip is believed to be the first example of a British council visiting Qatar with the intention of drumming up (those drums again, Ed.) support for inward investment. Birmingham will also host a UK-Qatar trade conference in March, the first time such an event has been staged outside of London.
Cllr Clancy was accompanied by Neil Rami and Waheed Nazir, Birmingham City Council’s strategic director for the economy.
As well as meeting the Qatar Business Association, Cllr Clancy held talks with Qatari government ministers (pictured) where discussions were said to have included investment opportunities around the £500M Smithfield redevelopment of Birmingham’s wholesale markets area, the £1Bn Curzon HS2 investment plan, as well as proposals for large-scale housing development.
Cllr Clancy said:
… as part of a post-Brexit resettlement cities in the UK have to have an international profile if their economies are going to grow.
It’s no good sitting back complaining about Britain leaving the EU. Cities like Birmingham must get out across the world and say ‘this is who we are, this is what we can offer to investors’.
We have had strong input from the Department of International Trade, strong embassy support — that says a lot about government policy.
Birmingham is off the starting blocks in the post-Brexit race. There are a huge range of options for big capital investment across the city, ranging from hugely significant regeneration schemes like Smithfield and Curzon, down to smaller shovel-ready projects.
I also made it clear to potential investors that one of Birmingham’s top priorities is to build new housing. We have to build 89,000 homes over the next 15 years simply to meet demand, and while the city council is the leading house builder in Birmingham, we can’t do this on our own.
Sources close the council leader underlined the need to reach out beyond Europe for investment in the post Brexit era. But Chamberlain Files has been approached by a senior figure in Birmingham’s property and investment community questioning the decision to spend time in Qatar rather than encouraging more investment from countries already committed to Birmingham such as the USA, Canada, Australia and Germany.
Consulting firm Grant Thornton produced the first report from its Vibrant Economy Index at a Live Lab event at Villa Park this week. The report found that Warwick is the most vibrant place in the West Midlands. The Index measures the performance of 324 local authority areas based on six “baskets” of socio-economic indicators, including both prosperity as well as health, well being and happiness.
Three mayoral candidates, Councillor James Burn (Green), Beverley Nielsen (Lib Dem) and Andy Street (Con), took part in a debate at the event.
Councillor James Burn said:
The West Midlands findings, like most of these reports, make stark reading. Again, it shows that there are areas of the West Midlands that are being left far behind particularly in the Black Country, where many people have far less money and less happy and healthy.
It’s clear we need big changes to our economy to help these areas – one or two little tweaks to the current plans won’t do the job. We need to invest directly in these areas and in small businesses which benefit local economies more. We need to encourage business growth in high demand areas that will give us secure jobs, like low carbon. And we need to work hard to include communities in the West Midlands Combined Authority plans, as that’s the best way to keep it honest and to make sure it works for them.”
The latest Global Economic Conditions Survey from ACCA (the Association of Chartered Certified Accountants) and the IMA (the Institute of Management Accountants) suggests that global business confidence in the last quarter dropped amid on-going political and economic uncertainty caused by:
- Government investment falling to its lowest level since the start of 2016, with many developed markets still firmly in austerity mode
- changes in the political landscape stemming from the recent US election
- Uncertainty over US / China trade developments
- Concerns over Brexit as well as forthcoming European Elections – 55% of respondents view Brexit as more of risk than opportunity.
The survey of over 4,500 finance professionals and business leaders worldwide has found that while the economic outlook has improved slightly in the US and China over the last quarter, the UK has hit its second lowest confidence levels since 2011.
Almost half (44%) of global respondents expressed concern over falling income due to low levels of government expenditure, with another 43 per cent reporting worsening business confidence.
But better news emerged from the UK Powerhouse Report produced for Irwin Mitchell by the Centre for Economic and Business Research (Cebr). It says that the Birmingham economy is on course to be £225M larger by the end of 2017 than it was three months after the EU referendum result.
The report predicts that the value of goods and services produced in Birmingham will grow by 0.7% during 2017.
To complete the Week, the Prime Minister is off to the World Economic Forum in Davos today to warn the global economic elite about those “left behind” by globalisation after making clear that the Government plans to leave the European Single Market.
Oh, Donald Trump becomes the 45th President of the United States tomorrow, promising to “Make America Great Again”. Sleep easy in your beds folks….
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