Each Month, Lancashire County Council reports to the Government on the wider economic landscape in Lancashire. The information is derived from various sources, including businesses, economic reports, and local authorities. May reflects a mix of optimism and challenges across various industries.
Fylde Borough significantly contributes to the Lancashire economy through various sectors and initiatives.
Key areas of contribution include its strong rural economy, significant business sectors, and prominent events.
These elements illustrate Fylde’s diverse contributions to Lancashire’s economy, driven by its own dynamic economy, significant business sectors, and vibrant tourism events. The continued focus on strategic investment and development will likely bolster these contributions.
Overview
Three Biggest Challenges to Businesses in Lancashire:
1. Workforce Development: The ongoing struggle to recruit and retain skilled workers poses a significant challenge across various sectors, including manufacturing, engineering, and logistics. Addressing this challenge requires targeted efforts to develop the skills of the existing workforce while also attracting and training the next generation of employees. The hospitality sector experiences fewer skill shortages but contends with wage pressure due to minimum wage increases. The Lancashire Skills and Employment Hub provides all sectors with support.
2. Property Availability and Infrastructure: Limited availability of commercial and industrial properties, especially grade A office spaces, restricts businesses’ growth opportunities. Additionally, transportation issues such as rising costs and container shortages impact supply chain efficiency, hindering businesses’ ability to operate effectively and expand.
3. Rising Costs and Economic Uncertainty: Businesses in Lancashire face rising costs across multiple fronts, including raw materials, transportation, and staff wages. Economic uncertainty, exacerbated by factors such as inflation and interest rates, adds further complexity to business planning and investment decisions, making it challenging for businesses to forecast and manage their finances effectively.
Three Positivity Drivers:
1. Resilient Business Community: Despite challenges, Lancashire’s business community demonstrates resilience and adaptability, with companies investing in expansion and relocation, particularly in the manufacturing sector. This resilience benefits the County’s economic recovery and long-term growth prospects.
2. Collaborative Support Networks: Organisations like the Chambers of Commerce and the Federation of Small Businesses, together with Boost Lancashire, are crucial in advocating for businesses’ needs and providing support and resources, with free support available to assist business start-ups, growth, innovation, and Net Zero challenges. Collaborative efforts between businesses, government agencies, support organisations, plus academic institutes enhance the county’s resilience and foster innovation and growth. Initiatives like supply chain solutions, workforce development programs, and investment in infrastructure aim to mitigate challenges and support economic resilience.
3. Positive Economic Outlook: Lancashire’s economic outlook remains positive despite ongoing challenges, with businesses expressing confidence in future growth prospects. Continued collaboration, strategic initiatives, and infrastructure and workforce development investments contribute to a favourable business environment and position Lancashire for long-term success and prosperity.
Summary of Lancashire Business Support Ecosystem: Challenges, Successes, and Opportunities
Challenges
- Political Uncertainty and Policy Shifts:
- The impending general election will disrupt regional councils.
- Potential changes in government policies and funding allocations could impact the stability of current support programs.
- Skill Shortages and Workforce Aging:
- Advanced engineering and manufacturing sectors face ongoing challenges with skills gaps, ESG compliance, and digital transformation.
- The Lancashire Local Skills Improvement Plan (LSIP) emphasises the need for collaboration between employers and training providers to address these issues.
- Industry-Specific Hurdles:
- The car industry struggles with transitioning to electric vehicles due to high costs, infrastructure limitations, and scarcity of replacement parts for older models.
Successes
- Boost Flying Start Initiative:
- This program successfully supports new businesses through peer networks, fostering relationships, knowledge sharing, and skill development. Take up has been excellent.
- Participants have shown increased business confidence and growth, with some diversifying operations to seize new market opportunities.
- International Trade Skills Bootcamps:
- The North & Western Lancashire Chamber of Commerce and Lancashire County Council have launched Skills Bootcamps to enhance exporting capabilities, focusing on the latest import and export skills.
- Innovation and Research Initiatives:
- Programs like the Global Business Innovation Programme (GBIP) promote innovation across sectors such as sustainable plastics, clean growth, quantum technology, and battery technologies.
- Management Practices Improvement:
- The ONS Management and Expectations Survey 2023 indicates improved management practices among UK businesses, correlating better management with increased productivity.
Opportunities
- Sector-Specific Growth:
- Initiatives like the Cumbria Robotics Cluster and the Future Fibres Network Plus for sustainable fashion highlight the region’s potential in cutting-edge engineering and sustainable practices.
- Funding and Investment:
- Significant investments, such as £86 million for advanced wind turbine technologies and £4.6 million for sustainable aquaculture projects offer substantial opportunities for transformative research and development.
- International Collaboration:
- Programs like Global Business Innovation Programme (GBIP) offer Lancashire businesses opportunities to expand into international markets, with initiatives in India, New York, Germany, and Australia focusing on advanced technologies and sustainable practices.
- Policy and Program Enhancements:
- The renaming of the Small Business Research Initiative to Contracts for Innovation aims to include various organisations in public sector R&D contracts, driving economic growth through innovation.
Additional Insights
- International Trade Developments:
- Head of the British Chambers of Commerce, William Bains’ visit to Switzerland, highlights its strong trading relationship with the UK, especially in finance and services. The negotiations for an upgraded UK-Swiss trade agreement focus on expanding to include digital trade and services.
- The UK’s entry into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) opens vast opportunities for tariff-free trade with economies across Asia and the Pacific, benefiting services and digital trade sectors.
- Automotive Industry Trends:
- The UK automotive industry sees robust growth in new car registrations driven by fleet demand for battery electric vehicles (BEVs), although private motorists face challenges due to inadequate public charging infrastructure and lack of fiscal incentives.
- The used car market’s growth in demand for electric models supports road decarbonisation, and the bus and coach sectors lead in zero-emission vehicle registrations.
- Strategic Policy Needs:
- The Automated Vehicles Bill positions the UK as a leader in self-driving vehicle regulation.
- SMMT‘s Manifesto 2030 outlines key pledges for government support in scaling up EV and hydrogen supply chains, boosting low-carbon energy, and fostering a healthier domestic market for zero-emission products.
Conclusion
The Lancashire business support ecosystem faces notable challenges, particularly political uncertainties and skills shortages. However, significant successes in fostering innovation, improving management practices, and enhancing export capabilities highlight the region’s potential. Ongoing investments and international collaboration opportunities position Lancashire businesses to effectively leverage these successes and address challenges, driving regional growth and competitiveness.
