Fastest-growing regional sectors 2023

5

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Fastest-growing regional sectors 2023

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Accommodation & food overtakes transport as fastest-growing sector in the North West 

  • The accommodation & food sector was the fastest-growing in the North West between 2018 and 2022, with the number of businesses in the sector and region growing by nearly a fifth (18%) to 19,000 over the period. Last year alone, the North West's accommodation & food sector saw 990 more businesses created.
  • Whilst accommodation & food flourished, the transport industry – crowned the fastest-growing industry last year on iwoca’s 2022 ‘Fastest-growing regional sectors’ list (covering 2017-21 growth) – has slipped in the rankings. Transport & storage shrank by 4%, representing 600 fewer businesses.
  • Against the backdrop of inflated business costs, staff shortages, and reduced consumer spending, overall business growth in the North West has slowed over the past year. Between 2020 and 2021, the North West’s business landscape grew by nearly 4000 enterprises, but 2022 saw just a net 200 businesses created, a marginal increase of 0.08%.

Top 5 fastest-growing sectors in the North West

(sectors with largest increase in business growth between 2018-22)

  1. Accommodation & food (+18.4%)
  2. Property (+17.8%)
  3. Wholesale (+16.4%)
  4. Construction (+9.4%) 
  5. Education (+7.4%)

Top local authority in the fastest-growing regional sector?

Bolton saw the biggest growth in the accommodation and food sector out of all local authorities in the North West between 2018 and 2022, with the number of businesses up over a third (38%). This was followed by Bury and Chorley, both up by 37%; 205 more hospitality businesses were created in Bolton since 2018, 155 in Bury, and 85 in Chorley. 

New job opportunities in the North West

This growth in the accommodation & food sector comes at a time when vacancies in the sector are high – official data shows that accommodation & food is the sector with the third-most vacancies between November 2022 and January 2023, after health & social work and wholesale & retail. 146,000 jobs are up for grabs in the industry across the UK, suggesting that thousands of positions could be available in the North West.

Nicholas Moo, owner of ChaTime teahouse in Manchester, said: “Hospitality in the region is booming – particularly as the rising cost of living since the pandemic is driving more consumers to settle up North, where rent and food are slightly more affordable, increasing footfall in local food and drinks businesses. Going even further back, when I started my business eight years ago, I was running the only shop in the area that sold bubble tea, but now there are over 15 others in my vicinity alone. Covid definitely hit our sector in the North West, but restaurants, cafés, and bars have bounced back since the pandemic. Although the current climate means some hospitality businesses are unfortunately closing in the short-term, they’re sprouting up at a much faster rate. It’s a great sign that more local restaurants and cafés are innovating new products for the changing demographic of the North West, and finding creative ways to run their businesses despite rising costs. From a small business owner’s perspective, the North West’s hospitality industry has a bright outlook in the longer term, and many jobs to fill.”

Transport revealed as fastest-growing sector in the North East, growing by 50% in five years

  • The transport & storage sector was the fastest-growing in the North East between 2018 and 2022, with the number of businesses in the sector and region increasing by a half (49%) to 3,700 over the period. Between 2021-22 alone, the transport & storage sector saw an increase of 410 businesses.
  • Last year – in iwoca’s 2022 ‘Fastest-growing regional sectors’ list (covering 2017-21 growth) –  transport was also the fastest-growing industry in the North East, indicating sustained growth in the region.
  • Second and third in the rankings were the North East’s property sector and accommodation & food sector, each seeing growth of over 15% since 2018.
  • The number of North East businesses in total increased by just 745 in 2022, compared to 1,060 the year before, signalling slower growth in the region.
  • Against the backdrop of inflated business costs, staff shortages, and reduced consumer spending, overall business growth in the North East has slowed over the past year, seeing a net gain of just 745 businesses, compared to 1,060 the year before (between 2020 and 2021).

Top 5 fastest-growing sectors in the North East

(sectors with largest increase in business growth between 2018-22)

  1. Transport & storage (+49%)
  2. Property (+17.5%)
  3. Accommodation & food (+15.2%)
  4. Public administration and defence (+13.3%)
  5. Construction (+12.1%) 

Top local authority in the fastest-growing regional sector?

Sunderland saw the biggest growth in the transport sector out of all local authorities in the North East, with the number of businesses more than doubling over the past five years (154%). In total, Sunderland has seen 315 more transport businesses in the area since 2018. North Tyneside ranked second, witnessing a 92% rise in transport businesses, followed by South Tyneside with 88%.

New job opportunities in the North East

This growth comes at a time when vacancies in the transport sector total 45,000 across the UK between November 2022 and January 2023, suggesting that thousands of open positions could be available in the North East.

Transport ranks as Yorkshire and the Humber’s fastest-growing sector

  • The transport & storage sector was the fastest-growing in Yorkshire and the Humber between 2018 and 2022, with the number of businesses in the sector and region growing by nearly a quarter (24%) to 13,000 over the period.
  • Last year – in iwoca’s 2022 ‘Fastest-growing regional sectors’ list (covering 2017-21 growth) –  transport was also the fastest-growing industry in Yorkshire, indicating sustained growth in the region. 
  • Second and third in the rankings were the North East’s accommodation & food sector and property sector, each seeing growth of over 13% since 2018.
  • Against the backdrop of inflated business costs, staff shortages, and reduced consumer spending, overall business growth in Yorkshire and the Humber has slowed over the past year, seeing a net increase of 1,775 businesses, compared to 2,270 the year before (between 2020 and 2021).

Top 5 fastest-growing sectors in Yorkshire and the Humber

(sectors with largest increase in business growth between 2018-22)

  1. Transport & storage (+24.4%)
  2. Accommodation & food (+15.8%)
  3. Property (+13.5%)
  4. Construction (+11.5%) 
  5. Retail (+9.9%)

Top local authority in the fastest-growing regional sector?

Doncaster saw the biggest growth in the transport sector out of all local authorities in Yorkshire and the Humber, with the number of businesses up by 85% over the past five years. In total, Doncaster has seen 710 more transport businesses in the area since 2018. Sheffield ranked second, witnessing a 66% rise in transport businesses, followed by Hull with 58%.

New job opportunities in Yorkshire and the Humber

Between November 2022 and January 2023, job vacancies in transport totalled 45,000 across the country, suggesting that thousands of positions could be available in Yorkshire and the Humber.

Seema Desai - Chief Operations Officer at iwoca, said: “This new analysis shows the sectors that drove SME growth last year, by location. It highlights clear opportunities for small businesses across these industries and areas to expand. Sectors like transport & storage and accommodation & food have truly flourished in the Northern regions over the past few years. This year however, uncertainty will likely hit SME growth across the country as businesses grapple with high running costs. SMEs are a crucial part of life in the UK’s regions, and they need accessible finance to support their growth. Alternative lenders are this lifeline for smaller businesses, providing them with the options they need to emerge unscathed from 2023’s economic environment.”

About the data

  • iwoca analysed ONS UK business: activity size and location data comparing business registrations between 2018 and 2022 - which can be found here. This data is broken down by sector and local authority.
  • ONS vacancies data by industry is published here.
  • For more information on the data used, or for raw datasheets, please contact press@iwoca.co.uk

Charlotte was a UK PR Manager at iwoca. She's been sharing news and insights about the finance industry for over four years.

Article updated on:
March 16, 2023

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