News & views

10 February 2025

The business landscape continues to evolve, and as we enter 2025, new challenges and opportunities have emerged for local businesses. Insights from the latest Leicestershire Business Voice (LBV) discussions highlight several key themes shaping the region’s economic environment.

Rising Costs and Financial Struggles

Businesses continue to grapple with financial pressures, but this year, concerns have shifted towards specific cost areas, including National Insurance, utilities, and insurance premiums. These rising expenses are squeezing margins and making long-term planning difficult. Additionally, access to funding remains a significant hurdle, with many SMEs struggling to secure investment for growth.

Transport and Infrastructure: A Growing Concern

Transport remains a major issue, with limited East-West connectivity in the Midlands identified as a key challenge. Businesses are calling for more reliable, higher-capacity trains and an integrated transport network, including bus-to-rail connectivity and better fare structures. The ongoing debate over regional control of train services is gaining momentum, with a push for localised decision-making.

Skills and Recruitment Challenges Intensify

The struggle to find skilled workers has worsened. Apprentice wages have increased, making it harder for SMEs to invest in training. Meanwhile, the shortage of experienced professionals, particularly in technical fields, is slowing down business expansion. The need for a clearer talent pipeline, better training programmes, and improved collaboration with universities is more evident than ever.

AI and the Future of Work

Artificial Intelligence is now at the forefront of business transformation, but many companies are uncertain about how to adopt it effectively. While AI offers potential for boosting productivity, concerns about its impact on jobs persist. Businesses are calling for incremental AI adoption strategies and workforce training initiatives to ensure a smooth transition.

The Evolution of Business Collaboration

This year’s discussions emphasised the importance of inter-business collaboration. There’s a growing interest in supply chain partnerships, cross-sector networking, and industry-specific events to foster more meaningful connections. Businesses are also exploring group-buying initiatives to help SMEs access high-cost services more affordably.

City Centre Revitalisation and Reputation

The state of Leicester’s city centre has become a priority issue. Businesses are raising concerns about high parking charges, safety perceptions, and declining footfall. There’s a strong push for targeted investment in areas like Granby Street and Belvoir Street to attract new businesses and enhance the city’s appeal.

Sustainability and Practical Green Initiatives

Sustainability remains a central theme, but the focus has shifted towards tangible actions rather than broad commitments. Businesses are seeking funding for built environment improvements that reduce carbon footprints and practical strategies to integrate sustainability into daily operations.

The Road Ahead: A Call for Action

The 2025 discussions reveal an increasing desire for actionable solutions rather than continued debate. Businesses want stronger local leadership, clearer funding routes, and more inclusive growth strategies. The role of LBV in bridging the gap between businesses, government, and universities will be crucial in shaping Leicester’s economic future.

As we move forward, fostering collaboration, innovation, and strategic investment will be key to overcoming barriers and capitalising on opportunities in the year ahead.