‘SMEs could provide £23bn boost to the North of England’s economy’
SMALL and medium sized firms could provide a £23bn per annum boost to the North’s economy if they became more productive, the Great Northern Conference was told
Sarah Longlands, the director of IPPR North, the policy think tank, warned that SME (small-and-medium-sized enterprise) growth rates varied enormously across the North.
She said many firms could benefit from improved business support. The IPPR is carrying out a detailed survey about SMEs across the North of England and how they can be encouraged to grow.
Ms Longlands told the event at New Dock Hall in Leeds: “We believe in the Northern Powerhouse debate SMEs haven’t been heard as loudly as they should be.”
“We would like to use this research to amplify their voice to make sure they are part of the Northern powerhouse debate in the future.”
Ms Longlands said that 99.8 per cent of private sector businesses in the North are SMEs. SMEs employ 63 per cent of all employees and account for £335bn in revenues each year, she told the conference.
She added: “We can see that SMEs are important but we also know that they lag behind in terms of productivity. We know that in each of the Northern regions the SME productivity lags behind the UK average.
“If we could increase the productivity within the North to match that of the national average that would be worth around £23bn per annum to the North of England.”
“The UK has a productivity problem; we know we have got lower productivity compared with other European and global nations.
“Productivity has very much stalled since the 2007 to 2008 recession. SME growth varies enormously across the North.”
Ms Longlands said that access to skills, training and education drive productivity and it was also important that firms had access to high quality business support.
Mandy Ridyard, the financial director of Produmax, a manufacturer of flight control components and assemblies for the global aerospace market, said: “It’s important for our community that we grow our business in the North.”
Gavin Opperman, the group business banking director of CYBG, who opened the debate on business growth and the importance of SMEs, said the success of the Northern Powerhouse concept showed that people could get behind a common cause.
He said the revival of Leeds Dock and the announcement that Channel 4 was moving to Leeds were developments to be celebrated.
He added: “CYBG has been an advocate for the North speaking with one voice. SMEs are absolutely crucial to the economy.”
Jason Aldiss, the managing director of Eville & Jones, who also took part in the debate, said he was frustrated by the poor quality of digital connectivity in parts of Britain.