On Thursday evening, Health Secretary Matt Hancock announced that renewed lockdown measures would be implemented in Northern England, including the Greater Manchester, East Lancashire and West Yorkshire regions.
These recently reimposed restrictions ban separate households from meeting each-other at their homes, and follows resurgences in COVID-19 cases in each of the respective areas. The reminder that this announcement presents – also following the rise in cases in Spain – is the prospect of a second, if partial, reimposition of lockdown measures across regions of the UK.
What does lockdown mean for businesses in Northern England?
In a survey of small businesses conducted by IW Capital, a second lockdown was the number one concern for SMEs, with 47% of respondents citing this as the worst case scenario, ahead of cashflow issues (44%) and debt (20%).
The effect of quarantining, however, are felt most acutely by SMEs in Northern England. While London was initially hardest hit, it is expected that activity in the English capital will recover far more quickly than in other cities such as Manchester and Bradford. London is not only the most tech-enabled and ‘business-ready’ city in the UK, but garners the most political attention and investment from overseas businesses.
With the loss of EU funding set to most adversely effect non-London regions going forwards, the renewed lockdown measures in Northern England will do little but increase existing disparities, unless the government focuses financial support on areas outside of its Golden Goose.
IW Capital reported that since the beginning of lockdown, SMEs have borrowed over £12 billion in government-backed loans, with the company’s statement finding that, “This support network demonstrates the vital importance of this sector”. Currently, SMEs employ in excess of 16 million people in the UK, and provide 52% of private sector turnover. Going Forwards, IW Capital states that more generous allowances for growth finance are needed – perhaps focusing such initiatives on regions such as Northern England would provide a much-needed boost.
IW Capital invests in the North
Speaking on the company’s commitment to invest in Northern England in spite of the prospect of renewed lockdown measures, IW Capital CEO and Founder, Luke Davis, comments:
“This period has been incredibly difficult for businesses up and down the country but it does seem to have impacted businesses in the regions harder than many in the capital. One of the key points in economic recovery in the next year or so is to allow every region of the UK to come roaring back with confidence and the right support in place.”
“As private finance providers, we have a responsibility to try and bridge this gap. There are fantastic businesses in the North of England with a huge amount of growth potential that may be slipping through the net as lockdown measures ramp up. This is why we are actively looking to invest in these regions and are seeking to employ investment directors specifically for the regions.”
“IW Capital has already started to encourage development in regions outside of London, and has invested in Impact Recycling – a company revolutionising the plastic recycling process based in Newcastle – and Billian – an innovative road-mending firm founded in Sheffield.