It’s that time of year, when Business Link Magazine invites the region’s business leaders to offer up their predictions for the year ahead.
It has become something of a tradition, given that we’ve been doing this now for over 30 years.
Here we speak to Dave Atkinson, regional director for the East Midlands at Lloyds Bank Commercial Banking.
Businesses in the East Midlands have faced challenges this past year. Many have struggled with skills shortages and supply chain issues, on top of broader economic headwinds, which look likely to continue in early 2023.
But despite this, local firms are looking at the new year with positivity. Our latest Business Barometer recorded the highest confidence reading from firms in the East Midlands since February, marking a ten-month high for business confidence in the region. What’s more, businesses are optimistic about the economy too, with inflation appearing to have peaked.
The hope will be that this relatively more positive economic outlook continues into 2023, clearing a path for businesses to focus on investing in growth, and manoeuvre other hurdles coming their way. Three key things for firms to look out for in 2023 will be energy prices, cyberthreats and staffing shortages. However, with the right planning and support, businesses will be able to turn each of these into opportunities for growth.
Energy costs and inflation will likely remain at the forefront of business owners’ minds in 2023, especially during the winter months, and they are likely to have one eye on the looming deadline for the end of the Energy Bill Relief Scheme on the 31st March. However, investing in sustainability offers an opportunity to alleviate energy bill pressures. From small everyday changes such as switching halogen lightbulbs to LEDs to more significant measures like installing solar panels or investing in more sustainable machinery and equipment, businesses should look to unlock the opportunities making their operation more efficient can bring.
Businesses looking to become greener can access tailored lending through schemes such as our Clean Growth Finance Initiative (CGFI), which provides discounted funding to help businesses transition to a lower carbon, more sustainable future.
The threat of cyberattacks is another likely concern for businesses in 2023, especially for those in the region’s crucial manufacturing sector. According to our latest Business Barometer, firms are already mindful of this growing threat to operations, with a quarter (26%) saying they will be prioritising investing in new technology, such as AI, automation and digitalisation to combat cyberthreats, over the next six months. In order to handle these threats, firms need to ensure they’re employing the right talent, as well as upskilling their existing staff.
More than a third (37%) of East Midlands businesses said they will be focusing on increasing staffing levels over the next year according to our recent survey. However, all things point towards labour shortages continuing to disrupt hiring plans, especially in the manufacturing sector, according to Make UK latest manufacturing outlook survey1.
In 2023, we’ll be continuing to support manufacturing firms struggling with skills shortages through our sponsorship of the Midlands-based Advanced Manufacturing Training Centre (AMTC) with £1m per year until 2030.
The AMTC has already trained more than 2,500 engineers, graduates and apprentices during the past eight years of our partnership, and our continued support will help grow this figure to over 5,000 by 2030. This will help the region’s firms manage the current labour shortages and skills gap challenges they are experiencing, as well as providing them with the skills they need to support the implementation of advanced technologies and solutions to drive innovations in cybersecurity and sustainability.
While firms in the East Midlands will be faced with some tricky roads to navigate in 2023, those that remain optimistic and look to turn challenges into opportunities for upskilling, driving sustainability and investing in their technology, will thrive.
