- The majority of North West businesses have returned to pre-pandemic revenues
- Staff shortages are the biggest threat to business growth in the region in the next three months
- North West businesses are digging deep to support employees, with 44% of companies increasing wages in line with inflation.
The majority of North West mid-sized businesses have returned to pre-pandemic revenues, two years after seeing sales fall.
According to new research from accountancy and business advisory firm BDO LLP, half of regional businesses are generating the same level as they were before COVID-19, with more than a quarter increasing revenue.
Despite the financial recovery, the region still faces considerable challenges, with the biggest threat to growth over the next three months being staff shortages (31%). Russia’s invasion of Ukraine and rising energy costs are also adding significant pressure to businesses. As a result, ongoing issues are preventing companies from prioritising key operational activities, with 28% of North West businesses unable to support worker wellbeing and a quarter struggling to deliver on long-term growth plans.
Ed Dwan, partner and head of BDO in the North West, commented: “To see such a high number of companies return to pre-pandemic revenues demonstrates the resilience and ambition of mid-sized businesses in the region.
“However, the fact remains that the economic landscape is still fraught with challenges – some unique and some very much intertwined with the pandemic. Unsurprisingly, COVID-19 ranks as the number one issue that has adversely impacted businesses in the last two years. As such, the culmination of challenges is leading many to relook at finance options, overhaul their supply chain and pause investment in the business.”
Despite this, businesses in the North West continue to put employees front and centre, with many implementing measures to support staff with the rising cost of living. According to the survey, 44% of regional businesses have increased wages in line with inflation, while offering staff other benefits, such as free childcare, subsidised travel to work, and free meals while in the office.
Dwan added: “With staff shortages the biggest threat to North West businesses in the next three months, the task of retaining talent has never been more pronounced. While prioritising issues, such as employee wellbeing, is proving difficult in the current climate, regional businesses are digging deep to provide as much support as they can – whether that’s through wage rises in-line or above inflation, or one-off bonuses – as the cost of living crisis continues to bite.”