Skills, education, infrastructure and support for SMEs were some of the key post-pandemic challenges highlighted by business and civic leaders from across the North West during a virtual roundtable.
The event was organised in partnership with NatWest and was part of a series of roundtables held across the 海角视频 looking at the impact of the Covid-19 pandemic on the region’s economy.
Kicking off the debate was Steve Rotheram, metro mayor of the Liverpool City Region.
He said the focus should be maintained on sector strengths and a recovery that looked at ‘building back better’ to protect public services, tackle inequality, provide secure well-paid jobs and create a shockproof economy.
He said: “We were the fastest growing city region before Covid and we were making huge progress and going in the right direction.
“There is a real danger now that that progress will be stalled but we could also go backward.
“There is bound to be aftershocks from this pandemic. Some of those may well include things like huge numbers of people being unemployed and young people feeling there is no hope for the future.
“There are areas where we had a competitive advantage such as life sciences, advanced manufacturing, innovation and the work we were doing around the green industrial revolution. All of those things may well be held back because most things need national governance and investment.
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“I have a fortnightly call with businesses including large firms, business support organisations as well as SMEs.
“And it’s the SMEs who have been absolutely battered by false promises from government."
He added: “The way that we will recover is by building back better. That’s something that’s really caught on in the North West and so much so that the national Labour Party has supported this and you will start to hear more of how we can do that."
Richard Topliss, Chairman of the North Regional Board at NatWest agreed that the SME market was facing huge challenges.
The bank has set aside a support fund of £5bn of working capital support to offer emergency fee free loans and overdrafts to relieve some of the pressure.
“SMEs have no confidence about what the future holds. That’s a really challenging space and we need to think about how we support them,” he said.
“Whilst we can criticise the government, there has been huge amounts of money being pumped into the economy and it’s been pumped into many businesses as well.
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“The challenge at the moment is that there are many businesses that are already borrowing a lot, they are now borrowing a lot more.
“We need to think about what the next stage is...this may involve recapitalisation.
"We also need to think about how we support long term key sectors in the North West such as aerospace, which is in a really difficult time as international travel is subdued. This leads to challenges around infrastructure, the airport and how do we keep those going and funded.”
He continued: “We should also focus on nurturing our young people. One of our purposes should be around supporting youth and young people who will be the long term sufferers if we are not careful.”
Alastair Machray, editor in chief for Reach PLC in Merseyside and Wales said readers were more concerned about where the economy will be in six to seven weeks.
“My sector has not been short of shock statistics in the last few months,” he said.
“The Federation of Small Businesses has said one in three small firms are unlikely to reopen at the end of this and are already making plans for redundancies. That’s terrifying because we are already through the job retention scheme, which is laudable and has already supported businesses that won’t be there to help us really kick start the recovery.
“The government borrowed £62bn in April alone and that’s not sustainable. So the hard thing for those making decisions is where do we focus.
“We have huge strengths here such as the low carbon economy, the bio-life sciences is a huge asset and one of our biggest assets is tourism.
“If you think about the cruise industry, the theatre and arts, what future is there for the short to medium term for those, and that for me, is scary.
“What is also scary is the drive we’ve had from the Liverpool region and in Manchester to create Grade A office space over recent years.
“We’ve listened to that, we did it and yet when I talk to business leaders daily, we’re asking are we ever going back to big offices?
“We’re not sure if we are and then what happens to our city centre business districts in those circumstances?
“We cannot save everything....where we are in two years is about where we choose to focus our resources now and that isn’t going be easy for business and civic leaders.”
Emma Degg, CEO of the North West Business Leadership Team, said skills needed to be prioritised.
She said: “For the first time in the last couple of decades significant levels of unemployment are going to be up and we are going to have to focus on that.
“When we have spoken about the skills gap, it’s been about hard to reach groups, it’s been about needing to do more in terms of trading.
“There are people who we have got to try and get them back into work as quickly as possible so their lives are not scarred by this.
“But to echo what Richard said, we have a cohort of youngsters leaving school, leaving apprenticeships, graduating this year and next year and they are the ones potentially to be scarred by this for the rest of their lives.
“We as a business community working with universities and FE colleges need to do all that we can to get those people meaningful training and employment. If I was going to prioritise anything, it will be that.”
Clive Memmott, CEO of the Greater Manchester Chamber of Commerce said northern cities need to make sure central government funding is not focused entirely on the south and each region has access to the pot of funding to help with recovery.
“The challenges created by the pandemic has a disproportionately much bigger impact on the north and the midlands than it does in the south,” he said.
“I agree that we need to focus on things that we can influence now and this is going to be one of the biggest challenges. I want to start with how do we organise this and we need to be clear on the regional needs.
“Health and social issues are extrinsically linked. One of the things we’re talking about is not just about having a safe place to work but it’s also about the journey to work, public space, and how we work things out in the near future will be challenging.
“In Manchester, 75,000 people commute every day and we don’t have the capacity to shift all those people safely even with many working from home or choosing an alternative way into work to avoid public transport.
“With skills and employment, we will need to invest in job creation schemes as we move onto stages of recovery.
“Infrastructure is also critical. What we need to make sure is that the national schemes are linked to the local schemes as well. These things will have to work for hand in glove. Rail schemes such as the Castlefield Corridor should be addressed now as it will create jobs, it creates wealth and it helps our economy’s recovery.”
He added: “We have to accept that our cities are based on retail, hospitality, leisure and the night-time economy, and we are going to need a much longer prolonged series of support for those industries as they emerge out of this.”
Damian Waters, director, North West, CBI said many of its members were focused on their return and how to ‘build back better’.
He also spoke of using this time to create an economy that was inclusive and benefited everyone.
“The economic impact is likely to be experienced even more so by women, low-income families, young people, and members of the BAME community so if we want to build back better we need to build back a better economy that is more inclusive because a more inclusive economy is a more resilient economy.”
He continued: “It’s a fact that more inclusive businesses are more resilient. Lots of our members are doing work to see how can we out of this terrible situation and come back with an economy that is stronger in many ways but is also different.
“There is a lot of difference in society and we need to take this opportunity and help those people that are likely to be the most heavily impacted in the short term and then build an economy and a system that encourages and enables those people to participate as we go forward.”
Commenting from a business perspective was Liverpool-based property lawyer Andrew Taylor from JB Leitch Solicitors.
The firm has had to furlough half of its staff as new instructions from clients dropped.
“Our big difficulty is that we have to sit and wait for our client base to get back into operation before they can instruct us again,” he said.
“So we are in a position of not really being masters of our destiny at the moment and I guess many businesses, especially SMEs, are in the same position.
“The real test in the short term is very much going to be how we transition our staff back into work and at what stage do we do that.
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NatWest is the national partner of BusinessLive.
The banking group is teaming up with BusinessLive on a series of events throughout the year aimed at entrepreneurs and business leaders.
Alongside a wide range of banking services, NatWest offers businesses specialist sector knowledge in areas such as manufacturing and technology, as well as access to specialist entrepreneurial support.
“One of the big conundrums for many SMEs out there, and it’s the same for us, is how you afford to bring people back when you’re trying to grow your revenues back to what it was in the first place.
“It’s a real balancing act. Whilst the job support schemes as been helpful, it’s going to end so we’re all in a bit of a wait and see position.”
Jonathan Grant, group executive chair of Manchester-based W Howard, a leading manufacturer and distributor of MDF profiles.
The company has also had to furlough some staff but currently has 85 per cent of its manufacturing team back in work.
“It’s a balancing act for us too,” he said.
“There was an initial flurry of when we started back at work and we were probably catching up a little bit before lockdown and that’s now working its way through production but now we’re trying to balance that out with sales which have leveled off. We now need to look at whether we put people back into furlough and at what point do we make the judgement call? This is something we are reviewing weekly.”
Commenting about the government’s response to the pandemic, Richard Topliss said the messaging from the government on a local, regional and national level needed to be consistent.
“We need to have consistent messaging and we need to be joined up through all of that,” he said.
“We also need to build confidence. So one of the challenges many of the businesses will face is actually encouraging people to come back to work and to do that we need to build confidence around public transport, around offices, and the safety of returning to work.
“People need sufficient knowledge around the risks because unless there is a vaccine, and I don’t see a vaccine anytime soon, people are going to have to accept a level of risk.
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“There will be an important part for local government to play in reassuring people and educating them around the risks and managing those risks but not believing there is an environment where there’s no risk at all.
“I also think national government needs to listen to local government in terms of the application of resources.
“It’s all well saying that they’re going to spend on infrastructure but that infrastructure needs to be the choice of the people of the north not just in London and it needs to make sense to us all.
“Regional government needs to think about our international profile as well and what is the message that we want to send globally about what the north west stands for and what the Northern Powerhouse stands for.
“Those are the key things that national and local government need to think about.”
Steve Rotheram agreed.
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“That’s where having a combined authority and six local authorities pulling in the same direction can really start to pay dividends for our city region.
“We have to get away from the old adage by some nationally that private was good and public was bad.
“We have to understand the synergies between those sectors and that if you cut one the other one bleeds. And so instead of constantly battling local authorities, we need now to provide them with support to start to take us forward.”
He added: “We need more investment from the private sector, and how do we that, we do that by having a public sector that works together that provides the ecosystem that attracts risks taking.
"All risk is relative, and all we can do is reduce that risk as far as reasonably practicable and that’s what we will have to do in society and it’s what we have to do in the economy.”