Ross McNally, executive chairman of Hampshire Chamber of Commerce
Ross McNally, executive chairman of Hampshire Chamber of Commerce, tells us why the region's businesses have every reason to be optimistic about the year ahead.
There are many reasons to be optimistic about doing business in Hampshire over the next year, albeit with some challenges as well.
Let’s start on the bright side.
In our latest members’ survey, 68% of respondents told us they would be developing new products in the next two years. Of those planning to hire new staff, three-quarters had identified new roles or growth areas.
This expansionist mood is seen across most of Hampshire’s key sectors including marine and maritime, aeronautics, advanced manufacturing and digital capability. Their strengths reflect much of the priorities set out in the government’s new industrial strategy.
Hampshire’s two Local Enterprise Partnerships - Solent and Enterprise M3 - are preparing the local industrial strategies that will ensure our region is at the forefront of growth in productivity, skills and the dynamic new technologies shaping our future.
I can say this with confidence because our industry sectors are already creating, or capable of using, innovative developments such as artificial intelligence, clean tech and smarter mobility.
On the manufacturing side, we are seeing national growth surging ahead at more than 3%. This is being fuelled by the devaluation of sterling that has given such a boost to exporters.
As we have a high prominence of manufacturers and service companies who sell overseas, Hampshire will almost certainly be driving this trend forward.
Indeed, 20% of Hampshire Chamber members are exporters and three quarters of them have said they are growing their export markets, a very positive sign.
Brexit of course receives a great deal of media attention but businesses on the ground are not waiting for new free trade agreements to be negotiated.
Future agreements will only improve an already competitive position so smart businesses are getting out there first and winning relationships. I am delighted that this is being reflected in our members’ surveys.
At the same time, major economies are doing well around the world. China is growing, albeit at a slower rate than before, the US is performing positively and the EU is more upbeat due to the euro recovering.
I believe companies here in Hampshire and the UK benefit from overall growth internationally. Our surveys show business owners being optimistic for the next 12 months. Positivity breeds positivity.
As regards government fighting Britain’s corner, it looks like the Prime Minister is finally getting round to sorting out a consistent team for international trade. I am cautiously optimistic about that.
So what are our main challenges?
Skills, and in particular higher level skills, are top of everyone’s agenda for 2018. This is not just a Hampshire issue but one that affects every region.
Businesses are repeatedly concerned about skills gaps and the difficulties of recruiting and retaining talent. This is a fundamental, systemic issue affecting even the most productive companies.
We can only progress if businesses stand up and work together with colleges and other education providers to improve people’s skills. It’s about building a lifelong commitment to continuous training and development.
Another challenge for Hampshire is infrastructure. Much more investment is needed in our transport links to build vital connectivity. Creating the Northern Powerhouse is one thing but there is unfinished business here.
In the Solent and south of Hampshire, I welcome the smart motorway project along the M27 between Southampton and Portsmouth and the improvements to tackle the M3 bottleneck at Junction 9 near Winchester but the truth is we are decades behind on such solutions.
More investment, and I mean billions of pounds’ worth of funding, is needed on road, rail, housing and employment land. A strong 20-year vision, together with the political will to make it happen, would tackle long-standing issues involving labour mobility along the coast and transform south Hampshire into one of the brightest locations in the UK economy.
We will also continue to lobby government about north Hampshire. We have an exciting corridor of innovation, growth and technology running all the way along from the M25 but, like the south of the county, there is potential to growth even further with the right investments.
The government must back both our LEPs every step of the way in building the infrastructure that will create jobs, growth and productivity.
Access to finance also remains an issue for many of our members. We have now seen 10 years of bank restructuring. Alternative finance sources have been great in many cases but now we need the banks to really step up again and properly organise business financing for a post-Brexit world.
In summary, while we do have our challenges, I genuinely believe Hampshire businesses can be optimistic going forward. We are well placed as a county to champion the innovation that the national industrial strategy calls for.
With a focus on skills, infrastructure and finance, we can create good jobs, prosperous communities and the best conditions to start and grow a business.