The COVID-19 pandemic has significantly impacted communities worldwide, with some of the hardest hit being working-class cities in the north of England.
But, with cities such as Sheffield recently receiving a £2M recovery fund to help local businesses re-launch, what more could possibly be needed to achieve optimal success?
This article will explore how Sheffield may need more than a £2m recovery fund to fully relaunch and support its local businesses.
Impact on a Global Level
Firstly, it must be noted that both local and global factors can impact an economy. For example, a stronger US dollar can make imported goods cheaper and extorted goods more expensive. That’s why even for residents of Sheffield, it’s important to be aware of how fluctuations in the DXY (US Dollar Index) can impact the importation of any goods. The pound sterling has an 11.9% weight here, hence it’s a useful index to consult for this purpose. Depending on the status of the global climate, local businesses within Sheffield may not be able to afford to import products as consistently as they might hope.
Impact on a Local Level
There’s no denying that areas in the North of England were already facing their own economic challenges before the pandemic of 2020. The decline of the steel industry in Sheffield has had a significant impact on the local economy and the spending power of its residents.
Historically, Sheffield was one of the world’s leading steel producers, and the industry employed many people in the city. However, the industry has undergone a significant decline over the past few decades, with many steel mills closing or downsizing.
The decline has had a knock-on effect on the local economy, such that it has led to job losses and a reduction in the number of well-paying, skilled jobs in the city. This has made it more difficult for people to find secure employment, thus leading to less disposable income.
In turn, many of Sheffield’s residents themselves have less money to support the local businesses of their city.
Competitive Industry
Similarly, there is newfound competitiveness in the local business market of this northern city. Due to the decline in the traditional industries within Sheffield, the city has seen a breakout of small independent retailers, all of which are competing with one another for customers, employees and investors.
This begs the question of how helpful the recovery fund will actually be for Sheffield’s residents. If more people than ever before are launching local businesses in the area with the same niche, how successful can they truly be in a region that sees high levels of deprivation?
What Can Be Done?
To truly see the economy of Sheffield thrive, measures beyond the government’s £2M investment need to be put into place.
Education and training can be a powerful tool for breaking the cycle of poverty and creating opportunities for economic mobility. Improving access to quality education and training programs, especially for disadvantaged groups, can help to provide individuals with the skills and knowledge they need to secure better-paying jobs and improve their economic situation.
Only by taking measures to improve the economic status of households in this working-class city, will we then be able to see differences in spending habits within the local business market of Sheffield.
Support Local, If You Can
Overall, supporting local businesses in Sheffield can have a positive impact on the local economy by creating jobs and driving economic growth. However, not everyone in Sheffield can afford to do.
Although the government’s £2M recovery fund will have somewhat of a positive impact on the economy of Sheffield, more needs to be done to fully integrate the city into the local economy and ensure its full potential is realised.
