Despite having to manage challenges related to the economy, costs and talent, we’re seeing a general level of optimism among businesses in the Midlands about their growth aspirations.
Head of Mid Corporate, Midlands, Barclays Corporate Banking
69% of businesses in the East Midlands are positive about using technological innovations or diversification to develop their business.
67% of respondents in the East Midlands say retention is their biggest staffing concern.
52% of business leaders in the West Midlands highlight rising costs as their biggest issue.
According to our latest research, carried out in conjunction with News UK*, more than half of businesses surveyed across the East Midlands (56%) and West Midlands (53%) are confident in their ability to grow their business, and similar numbers are looking to expand over the next 12 months.
In the East of the region, respondents say that rules and regulations (31%) and lack of access to finance (28%) are the most common reasons stopping businesses from expanding, whereas in the West, our research indicates that the main reason is a lack of confidence in the market (34%).
An increase in costs is the biggest issue for just over half of businesses surveyed in the Midlands, followed by recruitment and retention (East Midlands 40%, West Midlands 45%). Interestingly, business leaders questioned in the East Midlands also highlighted concerns around economic (43%) and political instability (34%), whereas skills gaps and shortages is the next biggest concern in the West Midlands (36%).
A majority (East Midlands 69%, West Midlands 59%) of businesses surveyed say they’re meeting all their goals or making headway in developing their business through technological innovations or diversification. Approximately half say they are looking to invest in new growth strategies in the next 1-2 years.
Despite the fact that interest rates have only recently started to come down, it’s good to see that businesses across the Midlands are focused on their growth and strategic visions. We’re proud to be able to support many businesses in the region that are looking to access finance to support their ambitions.
Head of Mid Corporate, Midlands, Barclays Corporate Banking
With almost nine out of ten business respondents indicating that developing staff skills to meet future needs is a priority area for growth (East Midlands 94%, West Midlands 88%), it’s good to see that approximately two-thirds of businesses in the region have staff development programmes in place to upskill their teams (70% in the East Midlands and 64% in the West Midlands).
We hear a consistent message from clients around the challenges of recruitment and retention. This is a key area that businesses need to have confidence in to support their growth strategies. Investment in staff development as well as in technology such as artificial intelligence that can support staff with the high volume, more mundane aspects of their roles, is likely to be key in ensuring people enjoy their jobs and want to stay in an organisation. Greater cooperation between businesses and academia is also essential. Given the wealth of educational institutions in the region, I think it’s incumbent on us to make the most of young talent and introduce students to exciting new job opportunities.
Head of Mid Corporate, Midlands, Barclays Corporate Banking
92% of businesses in the East Midlands rate embracing digital transformation as a top priority for growth.
84% in the West Midlands rate embracing digital transformation as a top priority for growth.
33% of those questioned across East & West Midlands said AI is not a business priority.
Digitisation is becoming increasingly crucial to business growth and development as firms look to streamline operations, increase efficiency, and stay competitive in a rapidly evolving market. While many business respondents in the Midlands say they have already completed or are in the process of completing their digital transformation programmes (East Midlands 62%, West Midlands 53%), it’s interesting to note that almost a fifth feel held back from pursing it, for example due to a lack of finance.
Although access to finance is seen as a barrier to expansion and digital transformation by some Midlands businesses, Karen says: “With a variety of financial solutions on offer, we’re here to support clients as they tackle obstacles and work towards meeting their objectives.”
Digital adoption is also key to leveraging data for more informed decision-making and meeting changing customer needs effectively. Businesses respondents in the Midlands report having a good understanding of the role data insights can play in responding to consumers’ behaviour and experiences (East Midlands 73%, West Midlands 68%), and around two-thirds across the region believe they’re equipped to do this.
With the capability and power of artificial intelligence (AI) advancing at speed, it’s perhaps surprising to note that almost a third of businesses surveyed across the region say it’s not a business priority. Barriers to the use of AI include a lack of understanding of its benefits (East Midlands 24%, West Midlands 29%), and employee skills gaps – both of which are given slightly more emphasis in the West Midlands compared to the East.
With AI expected to play a more significant role in business in the future to drive efficiencies, personalise customer experiences, and develop new products, businesses may want to consider where and how it could potentially support their growth strategies, if they aren’t already doing so.
Despite having to manage challenges related to the economy, costs and talent, we’re seeing a general level of optimism among businesses in the Midlands about their growth aspirations.
Head of Mid Corporate, Midlands, Barclays Corporate Banking
Just under three quarters (74%) of those surveyed in the West Midlands are either aware of or are familiar with Environment, Social and Governance (ESG) as a business topic, with a slightly smaller percentage being aware or familiar in the East Midlands (67%). ESG is a framework that helps businesses understand and measure their impact on society, the environment and how transparent and accountable it is. Under a third (29%) of business leaders questioned in the East say they’ve never heard of ESG – a considerably higher proportion than the West’s 19%, and the UK average of 22%.
That said, with ESG becoming an integral part of enhancing long-term business sustainability and of increasing importance to customers, employees, and investors, it’s encouraging to see that, of those business respondents that know something about the topic, several already have an ESG approach underway or established (with slightly more in the East Midlands at 52%, than the West Midlands at 40%).
In terms of investing in actions to improve the sustainability of the business, waste reduction is an area that a majority of respondents are planning to invest in over the next two years (East Midlands 67%, West Midlands 71%). More efficient use of resources, and improved recycling could allow business to cut waste disposal costs and potential enhance brand reputation. Providing employee training on sustainability (East Midlands 66%, West Midlands 59%) is another area of focus.
Thinking about ESG and sustainability, the barriers that have stopped businesses from investing in actions further are reported differently across the region. A deficiency of resources is the top issue identified in the survey in the East Midlands (33% – considerably above the national average of 20%), whereas a lack of clear return on investment (26%) is the main concern in the West Midlands.
While larger businesses may already be on their ESG and sustainability journeys, we know it can be more difficult for small and medium size enterprises to even get started. At Barclays, we’re committed to sharing best practice and advice to help businesses start and progress on their journeys and supporting businesses to access the finance needed to invest in their ESG strategy and goals.
Head of Mid Corporate, Midlands, Barclays Corporate Banking
To discuss your business requirements and how Barclays can support you, contact us today.
*Source: YouGov ‘News UK Barclays Survey’ April 2024. An online quantitative survey of 1000 business leaders working in businesses with at least 250 employees. Working in all regions of the UK except London. NB Survey size in Northern Ireland 15 businesses.
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