There is little doubt that Britain’s businesses have had a fairly rough ride of late.
They have been dealt a hammering over business rates, had to withstand rising inflation, seen recruitment suffer due to the housing crisis, and watched staff struggle with their daily commute beset with strikes and delays.
And that’s even before they start to unravel the intricacies of Brexit; what it will mean for staffing, for trade agreements, for tariff and non-tariff barriers.
It’s no wonder then that some of them are feeling a little bruised. In fact, the latest Capital 500 Quarterly Economic Survey from the London Chamber of Commerce and Industry (LCCI) found that businesses have felt negative about the country and London’s economy ever since the UK’s vote to leave the EU.
One of the most telling indicators is that the LCCI’s survey shows a record high number of recruiting companies having difficulties hiring new staff. Some 60 per cent of struggled when looking for suitable candidates, with professional or managerial and skilled technical roles being the hardest to fill.
It is clear that the skills and labour gaps are putting a strain on London’s businesses. While recognising that, in the long term, the main solution to closing the skills gap is upskilling the resident labour workforce, for the foreseeable future access to non-UK talent will remain critical to ensuring the capital’s continued success.
We think that, since London’s immigration needs are unique within the UK, a regionalised approach to immigration policy could go a long way to making sure the capital’s needs can be addressed in an adequate manner.
This could be achieved in part through provision of a separate Shortage Occupation List, along the lines that Scotland has. This would enable employers to better respond to acute shortages in specific professions and key sectors throughout the capital.
Another major issue raised by the Quarterly Economic Survey was that of domestic demand figures turning negative again.
We know that domestic demand must ultimately be underpinned by a healthy and productive domestic economy. The Industrial Strategy currently under development by the government provides an opportunity to make some real progress by recognising the role London has and will continue to play as the engine of the UK economy.
We make much of our business resilience, and I firmly believe we are right to do so.
London is a fantastic city, with world-class investment possibilities, a huge pool of talent and a wealth of opportunity. And we are growing – London will have reached mega city status of 10m people by 2030.
But we cannot ignore that at times businesses will find it tough – and right now is one of those times.
The good news is that there is much that can and must be done to lift business confidence at home, to reassure and attract investment from abroad, and to future-proof our city against the challenges it will inevitably face in the coming years.
So now we need our politicians, both in City Hall and Westminster, to take that action, not to just make generalised promises or engage in political point scoring.
Our recommendations are practical and achievable. We are not asking for the impossible.
What we are asking for is action; action to boost confidence amongst the capital’s business community by strengthening the foundations of London’s economy.