A Swing & A Miss?

Is the future of UK market(s) salvageable?

Following on from my thoughts around the UK construction industry, and the problems they face. Could these also be leaking into other industries?

Research released last August suggest that Gross Domestic Product (GDP) is circa ￡2.9 trillion, and is the 6th largest economy globally. Based on the GDP, almost 80% of this within the services industries, 10% manufacturing, 6% construction & roughly 1% agricultural.

Being the 6th largest economy globally, does not sound so bad, right? However, it does beg the question, how is our industrial, construction, manufacturing & technology fall so far behind the rest?

The below table provides a break down towards the end of Q4, 2023. Though, in respects of nominal GDP, i.e buying power per household, we sit around 3rd place.

Based on the magnificent Seven (tech giants within the S&P500), are currently valued up to $13.2 trillion, dwarfing our economy. Is there no hope for the UK moving forward?

In an attempt to “jump start” investment the UK economy, Jeremey Hunt, PM, announced a new UK-ISA is set to launch at some time in the near future. What does this mean to private investors? Will this have a big impact to the UK economy & stimulate investment?

As mentioned within my last article, has the bureaucracy corroded the ability to allow our economy to grow and adapt. The only futures tech company listed within the top 10 FTSE 100 companies, is ATM holdings, another semiconductor & software design company.

It would appear that both ends of the political spectrum are now back pedalling on green (renewable) investment, including future tech start ups. Is this new ISA going to be a precursor to future investments? The greenlight by the Inflation Reduction Act, in the USA, sees a surge of government investment within green technology. Based on reach via CleanTech, the EU, including the UK are falling behind funding, in early stage-technology.

To those who keep a keen eye on areas which are being the new “tech” hubs of the UK. These are being located within Reading & Leeds. Given the loss to the HS2 northern leg, this could be a possible detriment to the region, having the vast majority of financial lines located in and around London. A clear commute between the capital and such hubs should be on the agenda to boost such regional economies, and extension UK economy as a whole.

With our American counterparts seeing a significant investment of $21.7bn via the federal government, the state of Tennessee, is set to prosper, not just US firms setting up shop but also international firms such as Qcell (South Korea) & Freyr Battery (Norway). Within the state of Tennessee, circa 80% of all new green & tech investment is set here. The result, is new homes, schools, & improvements to existing infrastructure due to this initiative. The state, also has a very reasonable corporate tax of 6.25%, opposed to 25% here in the UK. There was a previous tax incentive for those within this industry back in 2021, a reintroduction to this incentive could look to reignite investment from abroad back to the UK.

I believe, that the UK is in a good state to kick start its industrial & technology sectors again, if the right investments and schemes are there to support those within the respective sectors.

The information contained in these articles and documents is believed to be accurate at the time of the date of issue, but no representation or warranty is given (express or implied) as to their accuracy, completeness or correctness. The writer,. accepts no liability whatsoever for any direct, indirect, or consequential loss or damage arising in any way from any use of or reliance placed on this material for any purpose. The contents of these articles/documents are the copyright of the writer. Nothing in these articles/documents constitutes advice, nor creates a contractual relationship.

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