By almost any measure, the southeast has the UK’s strongest regional economy
outside London. Pockets of science-based and high-tech businesses are
thriving, while there are green enterprises in Oxfordshire, IT and
communications around Reading, a prosperous marine industry in south
Hampshire and around the Solent, plus digital content, media and design
businesses in Brighton and along the south coast. The region has a focus on
innovative and knowledge-intensive industries served by a highly qualified
workforce.
It is “almost a privileged region”, in the words of John Thompson, head of the
national growth programme at accountant Baker Tilly, with a large,
productive workforce and an above-average survival rate for new businesses.
According to figures from the Office for National Statistics last December,
the southeast contributes £177.2 billion in GVA — gross value added, which
is income generated by economic activity, such as business profits and
wages. That’s £21,500 per head, against the UK average of £18,600.
“Compared with the rest of the UK the southeast is productive, in spite of
having higher costs and a bigger working population than other regions,”
says Thompson.
Past performance is, of course, no guarantee of future strength but
entrepreneurial businesses in the region are not, so far, buckling under
current market pressures. Paddy Thompson, senior manager with the Reading
office of accountants James Cowper, says there will be a clearer picture of
the downturn’s impact on the region’s GDP and business failure rate by the
yearend. “It may be that the southeast is favoured by its resources and
infrastructure. To date most clients haven’t seen a great slowdown.”
David Eagle, a Surrey-based partner with the accountants BDO Stoy Hayward,
says businesses are tending to be more conservative about expansion but on
the whole are not reining in their ideas and plans significantly.
“There is clearly more uncertainty but that’s focused mainly on their ability
to find and retain finance,” Eagle says. Bank finance has definitely become
more difficult to acquire, he adds, as has external investment.
The businesses Eagle talks to are still seeking new markets and products but
are evaluating their options more carefully, and especially are bearing in
mind the pressure that may be piled upon their core business. “I’m certainly
seeing no shortage of ideas being generated, but there is more caution and
moderation,” he says.
The roster of big names in the region testifies to its skilled workforce and
its attractions as a place to live and work: Microsoft, Oracle and
Hewlett-Packard are based around Reading and Amazon’s UK headquarters is in
Slough. Other global success stories include Vodafone, which began life in
Newbury in 1982 with fewer than 50 staff.
The first of the Hotel du Vin chain opened in Winchester in 1994. The company,
still headquartered in the historic city, is about to open hotels in
Newcastle and Poole. Rachel Lowe developed Destination, the bigselling board
game, while studying for a law degree in Portsmouth. She went on to found
RTL Games, based in the city, which produces 11 versions of the taxi-driving
game.
Paddy Thompson has seen a growing concentration of “green” enterprises in the
Thames Valley. He cites ClimateCare and Best Foot Forward, two Oxford
companies that advise businesses and individuals on how to measure, reduce
and offset carbon emissions, as evidence of good knowledge transfer between
Oxford University and the local economy.
Jeff Alexander, executive director for global competitiveness at Seeda, the
regional development agency, says that while most people traditionally would
not associate manufacturing with southeast England, aerospace, marine
technology and high-end automotive have a strong presence.
