LIVERPOOL BUSINESS SURVEY
2013-14
REPORT
JANUARY 2014
PREPARED BY 2020 RESEARCH LIMITED
26 Bridge Street, Penistone, Sheffield, S36 6AJ
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Page
Section 1 : Executive Summary 3
Section 2 : Analysis At An All Liverpool Level15
Business Satisfaction Index16
Prospects For Growth – Short-term17
Prospects For Growth – Long-term22
Business Support23
Liverpool As A Place To Do Business24
Liverpool Vision31
Liverpool City Council32
Satisfaction With Premises And Future Needs33
Skills Gaps36
Training AndRecruitment37
Relationship With Universities38
New Products, ServicesAnd Process Innovation40
Networking and Websites41 It’s Liverpool, I’m Liverpool 42
Business Promotion Offices42
City Mayor43
International Festival For Business 201445
Section 3 : Analysis At An Area Level48
Business Satisfaction Index49
Prospects For Growth51
Liverpool As A Place To Do Business52
Liverpool Vision53
Satisfaction With Premises And Future Needs54
Skills Gaps55
Training AndRecruitment56
Relationship With Universities57 Business Promotion Offices 57
International Festival For Business 201458
Section 4 : Analysis At A Sector Level59
Business Satisfaction Index60
Prospects For Growth61
LiverpoolAsA Place To Do Business62
Liverpool Vision63
Satisfaction With Premises And Future Needs64
Skills Gaps65
Training AndRecruitment66
Relationship With Universities67 Business Promotion Offices 67
International Festival For Business 201468
Appendix 1 Map of Liverpool Areas69
SECTION 1 : EXECUTIVE SUMMARY
Objectives
The Liverpool Business Survey is undertaken each year on behalf of Liverpool Vision and provides a comprehensive evaluation of howsenior decision makers at Liverpool businesses feel about Liverpool as a place in which to do business. The survey provides an objective measurement of their satisfaction with a number of key factors which influence their overall opinions. These factors include aspects relating to the local environment, including cleanliness, safety and transport, as well as views on quality and cost of premises, workforce skills, local business support and training, and local authority services.
Additionally, the Liverpool Business Survey reviews expectations of companies about their short-term and long-term growth prospects. For those businesses which are confident that their business will grow in future, the survey explores what actions they will be taking to support that growth, in terms of workforce development and expansion, or capital investment. The research also explores the interactions which businesses have with the community, including levels of contact with the City Council and with Liverpool Vision, the extent of networking activity with other local businesses, and the linkages which may exist with local universities.The survey also explores awareness and perceptions of the International Festival For Business, which is being hosted by Liverpool in 2014, looking at whether businesses feel this will be of benefit to the city as a whole, and to their business in particular.
The Liverpool Business Survey for 2013/14has been undertaken by the independent market research agency 2020 Research. This report provides analysis of the survey results for the city in total, together with a detailed breakdown by area and by sector. Results are compared against results from the corresponding survey last year (the 2012/13 Foundations For Growth survey).
Sample for the 2013/2014was provided by Liverpool Vision, as an extract from the MINT database of Bureau Van Dijk Electronic Publishing (BvDEP). This database provides comprehensive coverage of the business population in Liverpool, representing all sizes of company. The survey focuses on active businesses operating in the city and seeking to make a profit. Non-trading entities, businesses in the public sector, educational establishments and hospitals, places of worship and charities are therefore excluded from the survey. After these exclusions, the sample extract provided a base of 15,442 companies which could potentially be contacted for the survey. In total, 850 interviews were completed, with fieldwork taking place in November and December 2013.
In each case, the interview was conductedwith the most senior manager at each site. No referrals were made to head offices outside the Liverpool area, as it is important for the survey to maintain a local perspective.
The survey was structured to provide balanced coverage of each of the three geographic areas (City Centre, North and South). Quotas were applied so that the survey had representation from each area (337 interviews forCity Centre, 212 for North and 301 for South). Quotas were also applied so that the sample was balanced in terms of coverage of broad industrial sectors - Business services, Finance, Hotels and Restaurants, Manufacturing, Other services, Retail and Wholesale, and Construction and Transport. Finally, quotas were also set in terms of business size (number of employees).
At the analysis stage, data was weighted to reflect the geographic, sector and size profile of the total Liverpool business population.
Section 2 of this report provides an analysis of the data at an all Liverpool level. Section 3 then analyses the data by geographic areas, and Section 4 provides an analysis by industry sector grouping.
Conclusions
Key messages
BSI rating for Liverpool improved for the City Centre but fell for North and South: The overall Business Satisfaction Index has decreased from 6.96 in 2012/13 to 6.87 in 2013/14. Reactions differ significantly by geography. While BSI for City Centre increased from 7.05 to 7.21, there were falls for North (6.77 to 6.61) and South (7.00 to 6.74).
Perceptions of Transport and accessibilityhave fallen for those outside City Centre: The decrease in perceptions of Transport and accessibility is common to businesses in both North and South. Ratings were unchanged among businesses in City Centre.
Businesses in the South are less satisfied with Cleanliness and Quality of premises: There are significantly weaker ratings than last year for businesses in South on both Cleanliness (6.7 to 6.1) and Quality of premises (7.5 to 6.9).
Ratings of Liverpool as a place to do business also show polarisation between the City Centre and the rest of the city; while City Centre businesses are more positive about Liverpool, ratings have declined for both North and South: The proportion who rated Liverpool as 4 or 5 out of 5 as a place to do business fell slightly, from to 70% in 2012/13 to 67% in 2013/14. Ratings improved for the City centre businesses (71% to 75%), but fell for businesses in North (69% to 60%) and South (72% to 66%).
Liverpool continues to be highly valued for its thriving atmosphere and friendly community spirit, and there are increasing spontaneous mentions of its improved transport infrastructure, and its cultural breadth and heritage.
Where transport and accessibility is criticised, this is often in relation to issues with parking, or limitations with public transport.
Businesses are largely confident in the long-term prospects for the UK economy as a whole and for the Liverpool economy in particular: 79% of businesses are confident of growth in the UK economy over the next 5 years, and 83% confident of growth in the Liverpool economy over the same period.
More businesses are looking to invest in advertising and promotion, and training for their staff to support their own business growth: 57% of those who expect their business to grow expect to invest in advertising and promotion (cf. 52% in 2012/13); 54% expect to invest in training for staff (cf. 49% in 2012/13).
Business expectations of short-term growthhave improved among larger companies, founded on increased confidence that there will be growth in the UK economy, and confidence also of growth in the local economy in Liverpool: 65% of businesses with 20-49 employees now expect to see growth over the next 2 years (cf. 57% in 2012/13); 72% of businesses with 50+ employees now expect growth (cf. 66% in 2012/13).
While there is optimism about future business growth, the on-going cuts in public sector spending are still continuing to have an impact on businesses in Liverpool: 28% of businesses say that the reduction in public sector spending is having a large impact on their business, with a further 30% stating that is having a small impact.
As they look to grow their businesses, there is strong demand for support to help them expand into new markets:41% of all businesses state that they will be looking for support to help them expand into new markets. 28% will be looking for support for external training, and 27% for support in preparing a business development strategy.
Quality and skills of the workforce continue to be rated extremely highly. Technical skills are seen as a key need to support business growth, and finding candidates with the right technical skills is the main difficulty encountered in recruitment: 39% of businesses highlight the need to strengthen technical skills to help their business to grow; 37% highlight customer service skills, 32% basic IT skills and 26% advanced IT skills. 15% of all businesses experienced problems when trying to recruit (26% having no problems and 59% not recruiting). Among those who had problems, 51% highlighted the issue of recruits lacking technical skills.
Use of social networking by businesses is expanding rapidly: 59% of businesses now state that they use social networks for their business, compared with 50% in 2012/13.
There is increased usage of e-commerce applications within business websites, particularlyamong businesses in the Hotels and restaurants sector: The overall proportion of businesses with websites remains relatively unchanged at 75%. The proportion of businesses that have a website which includes e-commerce has increased from 38% in 2012/13 to 42% in 2013/14. Among Hotels and restaurants, 49% now have websites which include e-commerce, compared with 35% in 2012/13.
Ratings of the quality of business premises have weakened specifically among businesses in South: The proportion rating the quality of their premises as 8 or more out of 10 fell for businesses in South from 53% to 39%; in City Centre and North, the proportions were unchanged.
Opinions have become more divided on the benefits of the City Mayor, but the balance of opinion is still that this has a positive impact for the city: 14% believe the mayor is a positive benefit to the city (the same proportion as in 2012/13); an increased proportion however now consider the mayor to have a negative impact (5% cf. 2% in 2012/13).
Awareness that Liverpool is hosting the International Festival For Business 2014 has grown strongly and is widely seen as being of benefit in raising the profile and improving the image of the city, with the prospect of bringing long term investment to the city: Awareness of IFB has grown to 43% and is particularly high among City Centre businesses (54%). 85% agree that IFB 2014 will be of benefit to Liverpool and 33% feel it will benefit their own business. 14% say that they intend to participate in IFB 2014. 38% of all businesses think IFB 2014 will bring benefits to the city in terms of improved awareness and perceptions of Liverpool, 23% that it will encourage higher visitor numbers and 11% that it will bring increased investment into the city.
Awareness of Liverpool Vision has increased over the last year, and is likely to have been boosted by the activity it has undertaken in the last year in connection with promoting IFB 2014: Awareness of Liverpool Vision increased from 76% to 80%. Awareness is higher in City Centre and South than in North (82% cf. 73%).
Conclusions
Drivers Of Change in the Business Satisfaction Index
The Business Satisfaction Index(BSI) provides a summary measure of overall business opinions in the Liverpool Business Survey. The BSI score is based on the satisfaction with each of 8 separate indicators, weighted bythe relative importance of each component. (Further information on the BSI methodology is provided in the Technical Report).
The overall BSI score for Liverpool fell back slightly from 6.96 in 2012/13 to 6.87 in 2013/14.
There was substantial variation in how the BSI score changed for different areas of the city. While the BSI increased for City Centre from 7.05 to 7.21, it fell for both North (6.77 to 6.61) and South (7.00 to 6.74).
The eight variables on which the BSI is based are: Cleanliness, Safety in the city, Quality of premises, Cost of premises, Transport and accessibility, Quality and skills of the workforce, Local authority services, and Business support and training.
The most important of the eight variables continues to be Quality and Skills of the workforce. Ratings of the quality of the workforce improved during the recession, rising from 8.23 in 2010/11 to 8.48 in 2011/12. The higher level has been maintained through 2012/13 and 2013/14, as employers continue to place heavy reliance on their retained workforce to help their business to grow.
Average ratings of the quality of services decreased slightly in three areas. Ratings on Transport and accessibility improved in 2012/13, but fell in 2013/14 from 7.60 to 7.30. The decline was focused on businesses in North and South, with ratings of Transport and accessibility holding constant for those in City Centre.
There was a decline in perceptions of the Cleanliness of the city. Ratings of Cleanliness are significantly lower among businesses in North and South than for those in City Centre (5.9 North, 6.1 South cf. 6.6 City Centre). The declines in ratings of Cleanliness were relatively small for City Centre and North, but larger among businesses in South.
Ratings of Quality of premises also declined. As with Cleanliness, this was again largely focused in South, with just a small decrease in North and no change for City Centre.
One area where ratings improved was in Business and training support, which increased overall from 5.47 to 5.74. There are again substantial variations by area, with the trend again much more positive for those in City Centre. Ratings of Business and training support increased significantly for City centre businesses from 5.7 to 6.4, while North and South experienced no significant movement.
Conclusions
Prospects For Growth
Businesses in Liverpool largely remain confident of short-term growth (47% expecting to grow in the next two years). Fewer businesses are expecting that they will experience a decline in the next two years (7% in 2013/14 cf. 10% in 2012/13).
Underpinning these positive feelings, businesses are not only confident in their own abilities to grow their customer base, but also now highlight that they can benefit from the general improvement in the UK economy, and from the strength and growth in the local economy in Liverpool.
Confidence in business growth continues to be strongest among the larger companies (72% of businesses with 50+ employees expect to see growth in the next 2 years cf. 65% for 20-49 employees, 53% for 10-19 employees, 49% for 5-9 employee and 42% for 1-4).
In comparison with last year, confidence in short-term growth has strengthened among larger companies (20-49 employees 57% expecting to grow in 2012/13 rising to 65% in 2013/14; 50+ employees 66% expecting to grow in 2012/13 rising to 72% in 2013/14). This contrast with slight falls in the proportion of businesses of smaller sizes who expect to see growth in the next two years.
The businesses which are most confident of short-term growth are concentrated within the service sectors - Business services (55%), Finance (48%), Other services (46%) and Hotels and restaurants (47%).
Confidence in short-term growth remains relatively weaker for Manufacturing and Construction and transport, although both areas did experience some improvement on last year’s levels (Manufacturing increased from 34% to 40%, Construction and transport increased from 39% to 43%).
As the business environment has improved, levels of training being undertaken have increased. In 2013/14 55% stated that they had trained staff during the last 12 months (cf. 51% in 2012/13). The increased level of training for staff looks set to continue, with 63% stating that they plan to train staff in the coming 12 months.
Levels of recruitment by businesses are unchanged on last year, with 41% having recruited in the last 12 months.
Where businesses have encountered problems when trying to recruit, most commonly this has been because the candidates have lacked the necessary technical skills. Other comments highlight that businesses have felt some applicants lacked a genuine desire for the position being offered, either being unhappy with the working hours or the nature of the work, or unwilling to move into work for the wages which could be offered.
Conclusions
Liverpool As A Place To Do Business
Ratings of Liverpool as a place to do business decreased slightly in 2013/14 (67%of businesses giving the city a score of 4 or 5 on a five point scale, compared with 70% in 2012/13), but ratings are substantially stronger than they were 3 to 4 years ago.
Those who rate Liverpool most highly continue to highlight the strong community spirit and the thriving and vibrant feel of the city. There are also improving spontaneous mentions of the city’s transport infrastructure and its cultural breadth and heritage.
While transport infrastructure is a strength, there are increasing concerns from some businesses which relate to other transport and accessibility issues. These tend to be more prevalent among businesses located in North and South rather than those in City Centre. The main issues relate to parking restrictions, and limited provision of public transport services for some outlying locations.
Perceptions of the quality of premises have also decreased slightly for some parts of the city. Comments from businesses in certain locations highlight their frustrations that their areas are run down and receiving little attention, yet the rent and rates which they have to pay remain high.
Maintaining the cleanliness of the city is also a key concern, and problems are highlighted from litter, fly-tipping and dog fouling. There is a perception among some businesses in North and South that their areas receive much less attention than the City Centre.
Liverpool Vision
Awareness of Liverpool Vision has increased over the last 12 months (76% to 80%), particularly among businesses in City Centre and South. This is likely to have been influenced by the involvement of Liverpool Vision in the promotion of IFB 2014.
The awareness of Liverpool Vision is particularly high for companies operating in the Business services and Finance sectors (90% and 94% respectively). It is also strong among those companies which operate within Creative industries (91%).
Levels of contact with Liverpool Vision improved very slightly (16% to 18%), with the growth again coming from those in City Centre and South. Contact is substantially the highest from those in Business services (32% cf. an overall average of 18%). Contact is also high from the Creative industries group (29%).
It’s Liverpool, I’m Liverpool And Business Promotion Offices
Awareness of It’s Liverpool, I’m Liverpoolshowed little change (24% in 2013/14 cf. 22% in 2012/13).