Regus, the world's largest provider of flexible workspaces,
today presents its fifth Business Tracker report highlighting that
business confidence in Birmingham has slipped by 18% since April
but that hiring intentions in the city are among the most buoyant
in the UK. 61% of Birmingham firms surveyed said they plan to
recruit new staff in the next two years compared to 54% nationally.
In particular, they are taking on remote workers (27%) and
freelancers (38%), showing that companies are investing in a more
flexible workforce to deliver competitive edge now and growth in
the months to come.
This edition of the twice-yearly report - representing the views
of Birmingham businesses - also shows a dip in company
performance in the area, reflecting the recent worsening of the UK
economy. More than half (55%) of local firms do not expect to
see the full momentum of economic recovery until the second half of
2012.
However, a new trend has emerged: firms that trade
internationally are performing better in each of the report's
indicators than domestic players. Given the high density of
international firms in Birmingham, this could explain local firms'
bullish recruitment plans.
A Confidence Crisis
Stuttering economic progress and market volatility have reversed
the positive surge in confidence reported in April, when the
Birmingham Business Confidence Index stood at 108. Over the last 6
months, it has slipped 19 points to 89 - a slightly less marked
confidence collapse than the UK average (down 21 points).
Company Performance and Outlook
Birmingham firms' revenue growth has fallen well short of the
bullish expectations expressed in April's report with slightly
fewer firms chalking up revenue increases in this period (down 3
percentage points to 37%). However, this still places
Birmingham above the UK average (36%) and the Midlands (34%).
The proportion of firms reporting profits growth has fallen
significantly to 28%, certainly reflecting the challenging economic
conditions. Company performances are on a par with the UK
average (28%).
The Benefits of International Trading
Across the UK, there is a clear divergence between companies
that trade internationally and those solely focused on the national
market. Companies trading in overseas markets show a far higher
business confidence index score (96) compared to those focused on
the UK market (80), plus they are reporting higher revenue and
profit increases than domestic rivals. The recruitment plans
of international firms are also more buoyant, with a proportionally
greater focus on freelance and remote staff.
Celia Donne, Regional Director at Regus, comments: "The Regus
Business Tracker illustrates the recent reversal in the economic
outlook for Birmingham, especially in confidence which was clearly
on the rise in April. The dip in revenue and profit increases may
be minor, but it is telling that this period's revenue increases
are nowhere near the projections made back in April.
"That said, businesses are actively investing in their most
valuable asset: people power. With 27% of the employed population
in the UK now deemed to be flexible workers, freelance and remote
working in Birmingham is becoming an increasingly popular solution
to increase headcount while remaining flexible and rapidly
scalable.
"Firms that only operate in the national market should take note
that they are being outperformed by those targeting overseas
markets. It is now possible for even very small operations in
Birmingham to establish a low-risk presence in overseas markets
without making lengthy premises or equipment commitments and
allowing them to expand or withdraw depending on market
conditions."
About the Regus Business Tracker
Over 12,000 business respondents from the Regus global contacts
database were interviewed during August 2011, including 2700 across
the UK. The database of over 1 million business-people worldwide is
highly representative of senior managers and owners in businesses
across the globe. Respondents were asked about their recent revenue
and profit trends, along with their future views on a number of
issues including plans for hiring particular workers over the next
two years. The survey was managed and administered by the
independent organisation, MindMetre.
In every edition, the Regus Business Tracker report presents an
updated Business Confidence Index. This index is a measurement
formed on an aggregate of positive and forward-looking statements
combining year-to-date revenue and profit trends with views on the
expected economic upturn in the coming months and aims to provide
businesses with a single point of reference of the survey's key
findings. Its benchmark average was set at 100 in the first edition
of the Regus Business tracker in September 2009.