Business West reflects on another year and looks forward to 2023

The last few years have shown us that its always challenging predicting what the next year in business will bring. Companies in our region and beyond have been faced with the outbreak of the pandemic, followed closely by the end of the Brexit transition period, only then to be hit with record inflation levels and decreasing consumer and market confidence as the cost-of-living crisis deepens and a recession looms.

But the past 12 months have also been filled with strong achievements in business, something which can often be forgotten amid the turbulence. And as the saying goes, “If you are positive, you’ll see opportunities instead of obstacles.”  We need to keep in mind that wealth creation, that only business can do, is the basic building block for any sustainable, inclusive, and successful society.

We believe the South West, with its unique natural assets, has a great opportunity to be a leader in the green and blue economies. This year has seen the launch of Hydrogen South West, a partnership which will bring the benefits of hydrogen to the South West of England. This, along with other sources such as offshore wind and solar, will be crucial in easing our dependence on carbon heavy fossil fuels while reducing energy costs. 

Business West will be hosting a series of events and launching, as part of HSW, a new Hydrogen membership to help businesses get prepared ahead of the curve and ensure they’re equipped with the right skills to utilise this new pioneering form of renewable energy.

This focus on home grown renewables has been fuelled by key events in 2022 such as temperatures reaching record levels during the summer months, but also our desire to reduce dependence on other countries for our energy. 

It’s clear that we must now marry economic growth with climate action. We’ve found that knowledge about “what to do” is the biggest barrier for companies, so in the last year we’ve supported hundreds of businesses to make environmental changes via knowledge and information sharing through our workshops. As a B Corp business, our priority, as well as practicing what we preach, is to help businesses to take small, practical steps to tackle climate change and prevent further damage to the planet.

In the skills arena, this year has seen immense challenges for firms, with job vacancies reaching record highs. Business West’s recent Quarterly Economic Survey has found that 77% of firms are reporting recruitment difficulties in the last quarter, an increase of 5% since this time last year.

Our business communities need talented people and they’re not coming through. Our job is to try and help employers find their way through the maze of schemes and offers and get access to the right people. To help address this, the Local Skills Improvement Plans (LSIPs) were launched this year, which Business West is delivering across Swindon and Wiltshire, Gloucestershire, and the West of England. This involves bringing together employers to help inform funders and local training providers as to the key priorities and changes needed in the area to ensure skills gaps are being addressed.

Regarding international trade, while delayed orders, extra costly bureaucracy and supply chain issues are some of the real impacts businesses are facing in the overhang of Brexit and the pandemic, the South West is increasingly being recognised as a great place to invest and do business at a national and international level. We are hearing from an increasing number of businesses that their exports are thriving and our export documentation team are processing a rising number of documents, showing the sustained demand for business abroad. 

Despite a challenging year, enough good has happened in 2022 to leave me feeling optimistic about the year ahead. But there are key things the government needs to deliver for our businesses. We need to build further on the devolution of power and resources out of Westminster and into local hands, but in turn we need to ensure that this local governance is fit for purpose too.

My wish at the start of this year was for government to stop treating private sector businesses as a milch cow to support an ever-growing public sector. If anything, the situation has worsened with increasing taxation on business, whilst in parallel, we are seeing an undermining of our basic public infrastructure. 

While we have recovered in recent months some stability in government, the damage to credibility through the markets has stymied business investment. Whether its through less taxes, more R&D credits, or relaxations and/or streamlining of business sapping regulations, the government needs to create an economic climate and working public infrastructure that encourages business investment to achieve longer term growth. 

My message to firms over the coming year would simply be, stay positive because your country needs you. Our region, with its natural assets, talent, technical expertise and culture of innovation is at the vanguard of the future focus on sustainable growth and between the headwinds lie strong opportunities.