What does the Summer Statement mean for Birmingham?
What does the Summer Statement mean for Birmingham?
The variety of measures that were announced during the Chancellor’s recent Summer Statement showed the government’s dedication to getting UK businesses back on track.
However, although undoubtedly positive, is it enough? And what do they mean for Birmingham and the West Midlands?
We look beyond the headlines:
The £1,000 Job Retention Bonus means that for every employee brought back after the furlough scheme ends, businesses will receive £1,000. Read our comprehensive Q&A guide on the furlough scheme.
This announcement was welcome news to companies concerned about bringing staff back after furlough, but it certainly isn’t a fix-all solution.
Currently, the West Midlands has one of the highest employment rates in the UK at 75.5 percent. The region is also a major cog in the Midlands Engine, with the West Midlands being home to much of the UK’s manufacturing, capacity.
Many of these businesses will have been hit hard by the pandemic, turning to the furlough scheme to survive. However, once the scheme ends, will £1,000 per employee be enough to recover the Midlands workforce?
For long-term stability, Birmingham needs to look to increasing levels of foreign direct investment (FDI). Nationally, the city ranks third in terms of its attractiveness for FDI, but there is certainly room to improve. As digital technology is a main driver for FDI, this is where the West Midlands needs to focus, alongside continuing to drive innovation in the automotive, manufacturing and education sectors.
Job losses will likely be unavoidable, even with increased funding for apprenticeships and the £2bn ‘Kickstart Scheme’, so significant investment in new employment opportunities is vital.
Getting the housing market moving
In order to get people buying and selling houses once more, the Chancellor has raised the Stamp Duty threshold to £500,000 until 31 March 2021. As Birmingham continues to grow in popularity as a place to both live and work, this relief should help the housing market to bounce back quickly in the West Midlands. This will also benefit those that rely on a housing market such as house builders and furnishing businesses.
The Prime Minister’s ‘New Deal’ will also boost housing numbers in the region, with £84m of funding set aside for the West Midlands Combined Authority to build housing schemes on former industrial brownfield sites.
Laying down infrastructure
One detail missing from the Chancellor’s Summer Statement was that of major capital projects. From HS2 and Curzon Street to the 2022 Commonwealth Games, Birmingham and its surrounding areas are the sites of some of the UK’s biggest infrastructure projects, which support both the local economy and employment.
The £66m allocated by the government to assist with the start of numerous infrastructure schemes, will also go some way to aiding the region’s recovery. However, while this financial commitment is positive, £66m is not nearly enough to support the major projects required by the Region into the future.
At a glance, the Chancellor has given the UK some of the support it needs to get back to business, but these measures alone won’t be able to save every job. However, the West Midlands is a region full of potential, and COVID-19 hasn’t changed that. By pulling together and using the enterprising spirit the region is so well known for, we’re sure to come back stronger than ever.
If you would like support with any of the measures announced during the Summer Statement, or have any other queries or concerns about your business, then our free legal helpline offers bespoke guidance on a range of subjects, from employment and general business matters through to director’s responsibilities, insolvency, restructuring, funding and disputes. We also have a team of experts on hand for any queries on family and private matters too. Available from 10am-12pm Monday to Friday, call 0800 689 4064.
We have launched our guide to recovery and resilience, helping to support businesses and individuals unlock their potential, navigate their way out of lockdown and make way for a brighter future. Further advice in relation to COVID-19 can be found on our dedicated coronavirus resource hub.
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