Perceived North – South divide stifling UK SMEs

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Study investigates whether technology holds the key to halting regional business inequality

Over three quarters (76 per cent) of SME’s believe there is still a North-South divide and major geographical barriers in business, according to a new study out today into the perceived inequalities stunting growth.

From gaining government funding to accessing high speed broadband, the research by TalkTalk Business examined whether the North-South divide is alive and well and whether technology holds the key to breaking down regional barriers.

The construction industry felt the most affected by the North-South divide, with 91 per cent of firms within the sector claiming it still exists. Manchester was the city most affected by the division – according to 89 per cent of SMEs from the area – closely followed by Leeds (87 per cent).

A despondent 60 per cent of UK SMEs felt that the government provides more funding and investment to firms in London and the South East, whilst 64 per cent believe companies in and around the capital have access to the most skilled pool of employees.

SMEs have a more balanced view when it comes to the perceived technology divide between firms in the North and South. Nearly half (47 per cent) claimed that a greatly improved high speed broadband infrastructure in the UK has created a level playing field for firms operating in any geographical location. 24 per cent of SMEs claim it provides enhanced e-commerce and sales opportunities, 23 per cent believe it enables remote working, whilst 16 per cent felt next generation technology enabled their firm to be more agile.

Surprisingly, just under a third (30%) of SMEs would relocate their business to a different region, with 35 per cent opting for the South East, 15 per cent wanting to move abroad and one in ten preferring a switch to the Midlands.

The development of enterprise zones initiated as part of last year’s budget, which included the promised delivery of ‘super-connected cities’, has not eased concerns. 56 per cent of SMEs feel that the government’s ‘Broadband Britain’ pledge to roll out ‘super-fast broadband’ to all communities by 2015 is too late and hampering economic growth.

Andy Lockwood, product and marketing director at TalkTalk Business, said: “The purpose of the research was to gauge SMEs views on perceived geographical inequalities in business and the role technology can play in breaking down those barriers and providing a more equal landscape.”

“Improved mobility of firms across the country is essential in rebuilding the British economy. We’re therefore committed to providing a network which powers firms of all size and sector and ensures UK business has access to a broadband infrastructure which enables it to compete and achieve sustainable growth.

“Following an investment of more than £600 million in to the network we are now able to deliver superfast broadband to more than 90% of the UK, providing access to 2.1 million businesses nationwide. Representing unrivalled reach across the regions, we hope our continued investment in business grade technology will provide the support needed to increase business mobility across Britain.”