East Midlands comes out second when it comes to being named ‘High Investment Area’ by new KPMG UK study
Data revealed as part of new Local Business Pulse Index (LBPI), which uses AI to categorise places based on common economic strengths
Data revealed as part of new Local Business Pulse Index (LBPI), which uses AI to categoris
- Data revealed as part of new Local Business Pulse Index (LBPI), which uses AI to categorise places based on common economic strengths
- Seven new economic ‘clusters’ categorise 363 areas across England, Scotland and Wales
- Better investment is driving growth across the Midlands, with the east of the region recording strong consumer growth
The East Midlands has come out second when it comes to areas of high investment based on data in a new quarterly economic study from KPMG UK and the University of Nottingham.
The newly launched Local Business Pulse Index (LBPI) showed that both areas have been identified as High Investment Areas – places which share an expected high rate of growth in business investment – with 33% in the east, second when compared to the rest of England and against an average of 18%.
Standout areas identified for high levels of investment included:
- East Midlands – Amber Valley, Hinckley, North West Leicestershire and Ashfield
The data also showed that the area is showing high levels of new business creation with 20%, above the national average of 17%.
The LBPI provides data insights across 363 UK areas, drawing on geographic, sub-national data covering businesses, employees, and consumers. The online tool is aimed at businesses and local government leaders and includes an interactive map of Scotland, England and Wales, with navigable local and regional business growth perspectives and detailed snapshots of individual areas.
The insights are placed into seven clusters designed to reflect common business conditions and shared economic strengths. These include Business Creation; Sales Growth; High Investment; Employment Growth; Research and Development; Consumer and Leisure; and High Productivity.
Marc Abrams, Nottingham Office Senior Partner at KPMG, said:
“Understanding and harnessing local economic strengths is central to securing regional growth across the UK. Data-led insights drawn from the Local Business Pulse Index can support local leaders as well as inform investment and policy decisions.
“The East Midlands is seeing higher levels of investment compared to the rest of the UK, a great result in a time of economic difficulty.
“The East Midlands is also benefiting from high consumer spending.
“Overall, data from the Local Business Pulse Index is positive across several key sectors in the Midlands and outlines clear pathways for growth in the coming quarter.
“As a firm with a heritage in the UK regions, we work with local businesses across the country to identify productive, local potential. Our collaboration with the University of Nottingham provides detailed local snapshots on key drivers of growth.”
Further insights for Midlands in Q3 2023 include:
- The East Midlands stands out for also experiencing strong growth in consumer spending, with households in better financial health compared with other parts of the UK.
The LBPI will be updated each financial quarter, presenting a current and forward-looking view across each locality. Users will also be able to see where local areas have moved from one cluster to another, reflecting changes in the local business cycle.
Karl P Edge, Head of KPMG Private Enterprise in the UK, said: “As the economy continues through a challenging period, there’s growing emphasis on local authorities to define their economic strategies and leverage profile of their business community.
“That’s why we’ve created the Local Business Pulse Index to help pinpoint the growth opportunities across England, Scotland, and Wales. From the data, we can see there are distinct hubs for job creation, use of technology when working remotely, and investment. While we’ve experienced significant economic challenges over the past few years, it’s encouraging to see high investment levels come out on top, reassurance that growth and confidence are headed in the right direction for local areas.
“The need to understand local economies is crucial in prioritising investment and informing wider policy and with this tool, we can start to map out where our priorities should lie.”
Professor John Gathergood, at the University of Nottingham School of Economics, said: “We are delighted to bring together the latest economic data, together with artificial intelligence technologies, to create this exciting new product with KPMG. It will support businesses and governments to help make better decisions about localities across Great Britain.”
Notes to editors:
- The LBPI can be accessed via the following link: https://kpmg.com/uk/local-business-pulse-index.html
- The LBPI is updated on a quarterly basis, presenting a current and forward-looking view (into the next quarter) across each locality.
- Local Business Pulse Index (LBPI) includes interactive maps and deep dives into 363 areas across England, Scotland and Wales (on Local Authority District boundaries, as at November 2021).
- It draws on proprietary and open-sourced data, such as: levels of productivity (GVA) per job filled, research and development expenditure by firms, venture capital investment, new business creation, household credit scores and online job advertisements. This is combined with several sources of expectational data, including from Europe’s largest work-from-home survey, which tracks employer and employee expectations on local working arrangements, and a major survey of business leaders’ expectations of investment, sales and employment growth looking ahead into the year’s forthcoming quarters.
- KPMG and the University of Nottingham have a strategic partnership combining the organisations’ capabilities and expertise to bring insight to clients regionally and nationally. Joint initiatives, such as the development of the Local Productivity Index, offer solutions to support the local growth and innovation agenda, with a focus on advanced data analytics and financial technology.
About KPMG UK
KPMG LLP, a UK limited liability partnership, operates from 20 offices across the UK with approximately 17,000 partners and staff. The UK firm recorded a revenue of £2.72 billion in the year ended 30 September 2022.
KPMG is a global organisation of independent professional services firms providing Audit, Legal, Tax and Advisory services. It operates in 143 countries and territories with more than 265,000 partners and employees working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. KPMG International Limited is a private English company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients.