Three in five (59%) businesses in the West Midlands believe their prospects will improve in the next year, according to new data from Smith & Williamson’s inaugural report.
Looking across all UK regions, West Midlands firms rank third, behind the North West and London, in terms of business confidence. Companies from the region are far less optimistic when it comes to the wider economy however, with just two in five (39%) predicting UK economic growth will pick up in the next year.
For the research the accountancy, investment management and tax group interviewed 1,000 scale-up businesses and others yet to achieve scale-up – defined as businesses which have grown in either headcount or revenue by 20% for three consecutive years, from a starting position of ten or more employees.
The research also found that West Midlands firms were not wholly positive about recruitment. While more than a third (37%) plan to increase staff numbers in the next year to support growth, a quarter (25%) say they currently lack access to the talent they need. Two of the qualities that business leaders identified as most lacking from potential recruits were basic IT skills and business development ability.
According to the study, banks and investors could be loosening their purse strings in the West Midlands, with a quarter (25%) of SMEs claiming it has become easier to obtain finance, though 14% believe it has become more difficult. The report also found that one in four (25%) West Midlands firms plan to grow through merger or acquisition in the coming year.
Ray Abercromby, partner in business tax in Smith & Williamson’s Birmingham office, said: “It is highly encouraging to see that high growth businesses in the West Midlands are among the most optimistic about their prospects in the UK, behind only London and the North West, against a backdrop of the ongoing uncertainty surrounding the UK’s future trading relationship with the EU post-Brexit.
“The West Midlands is now the top UK region for foreign investment and home-grown business start-ups. Billions of pounds of investment is set to pour into our region over the next few years, along with a steady stream of new infrastructure investment.
“Nonetheless, clearly challenges remain, particularly around scale-up businesses’ ability to recruit the right people to enable them to continue on their upward trajectory.”
Our BQ Bulletin emails will land in your inbox at 7.30am, Monday to Friday, with a mix of the latest local business news, national news, and features to inspire you. Sign up here!
Click here to read our privacy statement