Updated: Jul 13
Economic developers in the UK have a lot to digest in 2022. Post-Brexit disruption to public-sector funding models and institutional reform of local government loom large. But it's important not to lose sight of what matters most to local economies - the real-world factors shaping job creation and investment. Alongside the economic cycle here are some of the most important to watch this year...
The pressures of the ‘shortage economy’ and the impact of technology. A potent mix… In 2022 UK-based firms are adapting to survive and grow in an economy where prices are higher and labour supply lower than expected. Where logistics and international trade are more challenging. And where growing use of technology forces more business decisions around location of assets and workforce...
Pressure to raise prices early in 2022. The increasing costs of energy, logistics, finance and COVID disruptions are squeezing margins. This will impact public-sector procurement. And it will hit business survival where price contracts are inflexible.
Recruitment challenges – bottlenecks in labour supply. Demographics, COVID and Brexit have combined to arrest growth in the UK’s labour supply. This will increase the interest of employers and employees in workplace automation and lifelong learning.
‘Out-of-area’ hiring – more competition for talent. More employers now offer remote working. More jobs seekers demand it. This means firms can recruit from further afield but face new competitors for talent at home. Local skills strategies must account for this.
More tech-based collaboration – new options and expectations. Most businesses say they will use the tools of digitally-enabled collaboration more not less in 2022. This will affect not only business location and operational choices but preferred methods of accessing support services.
Disruptions to international trade - more onshoring. Post-Brexit rules join new trade frictions with China and Russia. Longer-term these may impact industry collaboration and investment across borders. They may further encourage the building of 'locally-resilient' supply chains.
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