In Focus: Positives and negatives
There’s a few interesting surveys being published at the moment that are trying to pin down how next week’s Comprehensive Spending Review will affect businesses in the Midlands.
A new survey from Tenon reckons that one in ten Midlands entrepreneurs expect this month’s spending cuts to affect their business. However, it also says that one in ten think their business will pick up after the cuts are announced!
Companies reliant on government departments as their main source of business are set to be particularly badly affected, with reduced government spending hitting sales and potentially damaging financial stability and staffing levels, says Alistair Wesson, RSM Tenon’s regional managing director.
The RSM Business Barometer also found that nearly a third of Midlands business people (24 per cent) expect the cutbacks to negatively affect their company’s staffing levels.
Despite their expected severity, some business owners believe they will benefit from the spending cuts, buoyed by the prospect that reduced government budgets could lead to an increase in the number of public sector activities that are outsourced to private businesses.
In the Midlands, one in ten (10 per cent) of entrepreneurs expect to see an improvement in their company’s financial position as a result of the spending cuts.
Wesson says: “While some businesses dealing directly with government will inevitably be hit by the cutbacks, there are some clear opportunities for entrepreneurs to take advantage and fill the gaps resulting from reductions in government resources.
“Maintaining reduced spending levels will be a key priority for the public sector – this could well lead to an increase the number of public sector activities that are outsourced. Businesses that take the initiative and adapt their current practices to meet these public sector demands could therefore find themselves in a strong position in a year’s time.”
Meanwhile, it’s left to PwC to play the role of doom-monger. It’s said that the East Midlands must prepare for in the region of 58,000 job losses in the public and private sectors by 2014/15 as a result of the imminent public sector spending review.
One sector that is responding positively to a government announcement this week are the region’s universities, which have been falling over themselves to praise Lord Browne’s announcement about unlimited student fees. No surprise there, perhaps.
The University of Northampton has welcomed the “thoroughness” of the Browne review and the fact that it “fully recognises the value of higher education in society.”
Sir Bob Burgess, vice-chancellor of the University of Leicester, has welcomed Lord Browne’s review as “vital for maintaining Britain’s world-class higher education system”.
Horses for courses, then, and as we enter the relative calm before the storm, it’ll be interesting to see who can put a positive spin on the thunderstorms that are likely to erupt from the CSR. Watch this space.
Coments? Sam Metcalf, deputy editor, Midlands Business Insider
Recent Posts
Services
Dealmakers Services Directory
Directory Find an advisor to help you buy, sell or invest
Property Services Directory
Find an advisor across property services
Commercial Property Finder
Full commercial property listings in the Midlands
Guides
Midlands City View
The news, features and analysis that matter for your city
International Trade
Our guide provides expert analysis on a range of trade destinations
42 under 42 Members
The latest class of the Midlands brightest young business people
- Contact us
- Midlands
- North West
- South West
- Wales
- Yorkshire
- Other regions
- 0121 232 0980
- 0161 907 9711
- 0117 906 5900
- 02920 434500
- 0113 220 4410
- 0161 907 9718
- Insider regions
- Central & East
- Ireland
- Midlands
- North East
- North West
- South East
- South West
- Wales
- Yorkshire