Member Article

Skills shortage threatens Northern entrepreneurial growth

Northern entrepreneurs see bright future, but, according to EY, a shortage in skills poses a threat to growth plans.

Their survey found that 76% of entrepreneurs based in the North of England have increased their headcount in the past year with 36% of these businesses creating more than 50 new jobs.

However almost three quarters (73%) of Northern entrepreneurs say they struggle to attract the talent needed to grow their businesses, compared to 77% nationally, with 57% saying that this is down to a lack of the right skills.

Just over a quarter (27%) feel that they are able to attract the right talent, suggesting that the Northern skilled labour market remains challenging for many businesses.

EY surveyed 51 Northern entrepreneurs to assess how their firms have performed in recent years and whether they expect to grow in the future, as well as to gather their views on the factors that they feel can help or hinder growth.

Nearly all of the entrepreneurs surveyed in the North, have well-established businesses; 80% of respondents have run their companies for at least a decade.

EY found that 80% of entrepreneurial businesses in the North have seen growth in their turnover in the last year, compared to 75% nationally, with over half (57%) witnessing a turnover increase of more than 5%.

Looking ahead, over the next three years, 98% of Northern entrepreneurs surveyed expect their business to grow further, with over half (59%) expecting annual growth of over 10%.

Other findings included:

• 31% of Northern entrepreneurs cited cutting red tape as something the Government could do to facilitate growth
• 22% said that the current Government’s priority sector to invest in should be infrastructure (road, rail, airports), higher than the national figure of 17%.

Stuart Watson, EY’s Yorkshire and Humberside senior partner said: “Over the past 12 months the economy has strengthened, and this is reflected in the confident mood amongst Northern businesses.

“Entrepreneurs have been recruiting in significant numbers and seeing reasonable growth over the past year. But, more importantly, more than half are planning ahead for double digit growth.

“The North, like the wider UK, is open for business, and our entrepreneurs are leading the way in terms of increasing their turnover and headcount.”

“Overall the future looks bright for Northern entrepreneurs, with many delivering strong performance in recent years, and expecting good times ahead.

“However, our survey highlights that while businesses are increasing headcount at a considerable rate and are expecting to grow even more over the next year, the right people may not be there to fuel that growth.

“It’s clear that infrastructure remains a priority for Northern businesses. Entrepreneurs will be buoyed by the recent One North infrastructure proposals and the Chancellor’s vision for a ‘Northern powerhouse’, which we are likely to hear more about in the coming weeks and months.”

This was posted in Bdaily's Members' News section by Clare Burnett .