Financial resilience during economic decline: top 50 West Midlands’ manufacturing firms

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Abstract

The manufacturing output of the West Midlands is notably higher than the average across UK regions, making a significant contribution to UK GVA. However, manufacturing sectors are some of the hardest hit by changing macro-environmental factors, including soaring energy prices, the impacts of the pandemic and the UK’s withdrawal from the EU. Our analysis of the resilience of the largest West Midlands manufacturers on the basis of their current ratio finds that 20 of these firms are considered to be at high risk of being unable to cover their short-term liabilities. Notably, these firms employ 105,320 individuals; thus, the impacts of any firm bankruptcies would be significant. We call for policy interventions that precisely target firms which have a disproportionate share of employment and value-added. We also urge that interventions should be properly administered, with appropriate governance mechanisms installed, so that financial support reaches legitimate firms to ensure their efficacy.
Original languageEnglish
PublisherWMREDI
Number of pages6
Publication statusPublished - 20 Oct 2022

Bibliographical note

This project was funded by the Research England QR Enhancing Research and Knowledge Exchange Funding (C016.10006.65730), University of Birmingham, 2022.

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