WEST Midlands leaders are drawing the up a ‘recovery action plan’ for the region, mayor Andy Street has said.
Political and business leaders say they are now working together to form a bespoke strategy capable of securing an effective and long-lasting economic recovery.
The move comes as research from the region’s Economic Development Institute predicts that the West Midlands could be the UK’s hardest hit region.
Presented to business leaders, unions, and councils, the report said: “Surrounding shires with strong tourism and hospitality sectors face being hit harder by the lockdown than the metropolitan area – Stratford’s economy could shrink by nearly half (46 per cent) compared to 35 per cent in Birmingham in the second quarter
*Sixty-five per cent of businesses say their cash reserves are dwindling fast and will be gone within six months raising fears for their longer-term survival.”
Mayor of the West Midlands Andy Street, said: “This lockdown is having a profound impact on our regional economy and the research suggests we could be hit harder than anywhere else.
“It is clear that this unprecedented lockdown will soon start to be lifted, and its crucial we are ready for that and have a clear roadmap to navigate our way through this difficult time.
“By preparing now, I’m confident we can secure a successful reboot of our economy and accelerate growth in key sectors.
“But it’s also important that the West Midlands has a clear voice in the recovery plans being drawn up by Government, and I will continue to lobby for that to happen.”
He added the mayor’s office would be challenging regional banks to lend to support local businesses, and reviewing infrastructure plans to bring forward large projects.
Coun Ian Brookfield, WMCA portfolio holder for economy and innovation and leader of City of Wolverhampton Council, said: “The coronavirus outbreak has made it an extremely challenging economic climate for our region’s businesses.
“Various Government measures have been put in place to support them and their employees during this difficult time to help ease the pressure they are feeling.
“It is critical we now take extra steps as a region to help protect our business community by providing clear guidance and support that will give them the best chance of recovery and delivering a long-term plan that will enable economic growth.”
The report also found rapid use of cash reserves by businesses has serious implications for their longer-term survival and that further financial interventions may need to continue if demand doesn’t return.
Businesses are also being forced to wait longer for payments from customers and while the size of workforces has on the whole remained the same, hours are reducing and the region has seen a drop in contract staff.
The report says areas most affected will be those with high levels of hospitality and tourism which are disproportionately losing revenue.