‘Lifestyle’ Versus Value Creation In Merseyside’s Economy
Merseyside’s economy is often criticised for being too public-sector driven. And now the critque has extended to some sharp observations about the type of businesses which are here, as well as just how few of them there are. Maybe a bit of ‘experience swap’ would help us to get a wider picture?
There has been a lot of comment in recent years about the over-reliance of the Merseyside economy on the public sector, over the private one. It’s not so much, we are told, that there’s too much of the former, but rather that there’s not enough of the latter.
But now it seems even that defence is blown. At his quarterly report to the Liverpool Society of Chartered Accountants, corporate financier Steve Stuart has criticised Merseyside’s private sector for being ‘life-style’ at the expense of ‘value creation’.
This seems fair comment. Apparently, of 27,000 VAT-registered businesses in the area, 26,000 employed fewer than five people – and less than 700 had a turnover of more than £2m.
Too cosy or too costly?
The problem seems to be that most local businesses are averse to interference from outsiders, and like to do things their own way. This is a situation for which Mr Stuart holds local business advisers in part responsible.
Given the choice of external ‘interference’, or keeping things within the family, nearly all business people in these parts chooses to stay cosy. Not many want to take on the extra cost of private equity funding.
Well, I’m not surprised. Who around here has even heard of private equity funding? Of course, those in the world of banking are familiar on a day-to-day basis with this sort of arrangement; but you don’t bump into equity financiers on every corner in these parts.
This is, sadly, a part of the country where having A-levels is quite a considerable achievement for some folk… and where the difference between a pass degree and a doctorate is often seen – if it’s understood at all – as an irrelevant distinction. So not many of our home-grown entrepreneurs are bothered about the fancy stuff.
Who’s responsible for the Merseyside economy?
But before we ‘blame’ anyone too much for this unambitious state of affairs, for inhabiting such cosy comfort zones, it might be interesting to ask exactly who we think is ‘responsible’ for the health of our local economy. And my answer is, I’m not sure anyone really knows.
For my part, I regret that local people seem to need to be so cosy; but I don’t think it reasonable, given the claustrophobic and stultifying circumstances in which they survived until quite recently, to expect everyone in Merseyside who owns a business to want to go Big Time.
Before we see too much progress here I suspect we shall have to shake things up a bit – and one way might, dare I say it, be to bring in business ‘advisers’ from other parts of the country… and invite our home grown ones to work in differently-challenged business environments elsewhere, for the experience this would bring of other ways of doing things.
Then we’d all get a view of how green the grass is (or, depending, isn’t) on the other side of the fence. And that might really make some of us take ownership of pushing our local economy forward.
Posted on November 22, 2005, in Knowledge Ecology And Economy, Liverpool And Merseyside, Politics, Policies And Process, Regeneration, Renewal And Resilience, The Journal. Bookmark the permalink. 1 Comment.