Latest research from the Midlands branch of national insolvency and restructuring trade body R3 paints a mixed start to 2023 for East Midlands businesses, with a significant increase in start-ups but a doubling of insolvency-related activity.

R3’s figures, which are based on an analysis of data from business intelligence provider Creditsafe, highlight a 13.9% rise in the number of companies set up in the East Midlands since the beginning of the year, rising from 2,460 in January to 2,803 in March.

R3’s analysis also shows a sizeable decrease in the number of bad debts on the books of East Midlands businesses, falling by 21.3% in March to 111 from 141 in January.

R3 stresses, however, that seeing these statistics as signs of longer-term business recovery should be viewed with caution, not least because there has been a sizeable increase in insolvency-related activities in the region since the beginning of the year.

The number, which includes liquidator and administrator appointments as well as creditors’ meetings, more than doubled (108.3%) between January and March of this year, indicating the extent of the economic challenges still facing East Midlands companies.

R3 Midlands committee member Stephen Rome, a director at law firm Thursfields in the region, said: “This R3 report reveals how challenging it is for local businesses to survive and grow in this current climate. While the increasing number of start-ups in the region is positive, as are the indications of improving cashflow, we are still facing huge economic hurdles.

“Inflation, contracting economies, higher energy and wage costs and low consumer confidence are all threatening the sustainability of East Midlands businesses, who are having to fight hard to survive.

“Our advice to any directors who are worried about the viability of their company, start-up or otherwise, is to seek professional help and to do it as soon as possible. Many R3 members offer a free consultation to those who want to explore their options.”

Workforce challenges such as skills and labour shortages outrank rising costs and interest rates as one of the top concerns facing mid-sized businesses in the next six months, according to the latest research from accountancy and business advisory firm BDO. Nearly a third (32%) say it is one of the three biggest challenges they face, second only to supply chain pressures. The bi-monthly survey – which looks at the challenges and opportunities facing mid-sized businesses – reveals that almost half (48%) are experiencing skills or labour shortages. Nearly two-thirds (61%) cannot recruit enough entry-level staff, with even more (73%) struggling to plug gaps at a lower-managerial level. Two in five mid-sized businesses (42%) say it is too expensive to hire new staff because of costs including immigration bureaucracy, National Insurance contributions or higher salary expectations from candidates amid the cost of living crisis. A third of firms (35%) are struggling to recruit enough people due to immigration restrictions, rising to 43% of hospitality and leisure businesses. A further 41% are unable to replace staff who retired during the COVID-19 pandemic, with data from the ONS showing a mass exodus of over-50s from the workforce between March 2020 and November 2021. These mid-sized businesses – defined by BDO as firms with revenues between £10m and £300m that are privately owned, backed by private equity or listed on the AIM market – employ eight million people and provided a quarter of UK jobs as of March 2023, according to further research. In the face of labour shortages, more than a quarter (26%) are offering existing staff opportunities to retrain, while a third (32%) plan to invest in upskilling over the next five years. A similar number (30%) will use more freelancers to access particular areas of expertise. In a bid to expand their access to talent, businesses are exploring new hiring methods. One in five (23%) are recruiting more staff through trainee schemes or apprenticeships, while over a quarter (27%) are offering specific incentives to attract more diverse hires, including childcare vouchers or health and wellness support. One-fifth (20%) are removing academic criteria from job adverts to broaden their candidate pool and 25% are exploring new working patterns such as four-day weeks. A quarter (25%) also expect to see an increase over the next five years in the number of workers aged over 50, as firms prioritise upskilling and retention. With workforce challenges adding to existing economic pressures, businesses are turning their attention to artificial intelligence and other technological solutions. A fifth (21%) plan to trial or allocate budget for automation and new technologies over the next six months in order to increase efficiency, while more than a third (36%) plan to increase spending on AI in the next five years. Against this backdrop, businesses are looking to the Government for fresh support. As firms struggle to hire and momentum grows around AI, over a quarter (26%) would like to see investment from the Government in automation to help businesses increase efficiency and cut costs. A fifth (20%) are calling for immigration policy changes, such as faster processing and additions to the Shortage Occupation List, to plug skills and labour gaps. A similar number (21%) want to see the Government broaden the variety of post-16 education options, while a further fifth (20%) hope to see tax cuts for companies in areas where the regional economy is performing less well. Ed Dwan, partner at BDO, said: “Workforce issues have the potential to be a real drag on UK productivity. While it’s heartening to see mid-sized firms invest in more diverse hiring and upskilling existing staff, these challenges clearly aren’t going to go away overnight. “Skills gaps and worker shortages have a real impact on firms’ productivity, output and morale, and could cause a slump in business confidence over the long term. Businesses need a helping hand from Government if they’re to overcome this and achieve the growth we know they’re capable of driving as the UK’s economic engine. “More investment in areas such as high-quality apprenticeships, or incentives for people to train in areas where skills shortages are most severe, could have a huge impact.”

The CBI (Confederation of British Industry) has suspended all policy and membership activity until an Extraordinary General Meeting (EGM) in June as dozens of companies, including Rolls Royce, are leaving the organisation or pausing their memberships following allegations of rape and sexual assault. It follows reports in the Guardian that a second woman had made a rape allegation against two CBI workers, and comes after a series of historic misconduct claims over recent weeks. A statement from the CBI board said that it “shares the shock and revulsion at the events that have taken place in [the] organisation, and at past failures that allowed these events to happen,” with the organisation planning to put forward proposals for a refocused CBI at the June EGM for its membership to decide on its future role and purpose. The CBI said: “We are deeply sorry and express our profound regret to the women who have endured these horrific experiences. “We have listened carefully to what our colleagues, members and stakeholders have said over recent days and weeks. We have heard loud and clear a demand for far reaching change. “We want to properly understand from our colleagues, members, experts and stakeholders how they envisage our future role and purpose. As a result, we have taken the difficult but necessary decision to suspend all policy and membership activity until an Extraordinary General Meeting (EGM) in June. “At the EGM we will put forward proposals for a refocused CBI to our membership for them to decide on the future role and purpose of the organisation. This work and the cultural reform will be the entire and urgent focus of the organisation over the coming weeks. “Our members have told us in recent days and weeks that they believe in the importance of a collective voice to inform national policy and the unique role that an organisation like the CBI can play in public life. But much needs to change if we are to win back their trust so we may continue to represent business at this critical time for the country. “We are taking steps to address our failings but recognise these are not yet sufficient to sustain the confidence of our colleagues, members and of the broader business community.  We know it will take time to rebuild trust in our purpose and culture. And to give our team and former colleagues the space to heal.” Some business leaders have called for the CBI to disband.

MKM has joined the sponsor line up for the East Midlands Bricks Awards 2023, backing the Commercial Development of the Year category. Speaking with Business Link, Gavin Moody, Branch Director at MKM Nottingham, said: “MKM are proud to be sponsoring the Commercial Development of the Year category at the annual East Midlands Brick Awards. It is important to us that we celebrate the construction industry’s achievements and highlight local business development in this way. East Midlands Business Link do a great job with these awards, shining a light on the area and bringing businesses together.” Sam Shipman, also Branch Director at MKM Nottingham, added: “Each MKM branch takes great pride in supporting its local construction community, helping to ensure these commercial developments are brought to life with the highest standards. “The Awards are a fantastic boost for businesses and so easy to enter. It is a great opportunity for companies in the area to celebrate the amazing work that they have been doing and share their successes with the wider industry.” The awards, which will take place on Thursday 28 September at the Trent Bridge Cricket Ground, celebrate the outstanding work of those shaping the landscape of our region, recognising development projects and people in commercial and public building across the East Midlands – from offices, industrial and residential, through to community projects such as leisure schemes and schools. Nominations are now OPEN for East Midlands Business Link’s annual Bricks Awards. To nominate your (or another) business/development for one of our awards, please click on a category link below or visit this page.

Book your tickets now

Tickets can now be booked for the awards event – click here to secure yours. The special awards evening and networking event will be held on Thursday 28 September 2023 in the Derek Randall Suite at the Trent Bridge County Cricket Club from 4:30pm – 7:30pm. Connect with local decision makers over canapés and complimentary drinks while applauding the outstanding companies and projects in our region, and hear from Mike Denby, Director of Inward Investment and Place Marketing at Leicester City Council, our keynote speaker. Dress code is standard business attire. Thanks to our sponsors:                                                             To be held at: