BizResearch

London’s Economic Outlook: Autumn 2009

The autumn 2009 edition of London’s Economic Outlook (LEO) is GLA Economics’ 15th London forecast. The forecasts are issued every six months to assist those preparing planning projections for London in the medium term. The report contains an overview of recent economic conditions in London, the UK and the world economies with analysis of important events, trends and risks to short and medium term growth. It the ‘consensus forecast’ – a review of independent forecasts indicating the range of views about London’s economy and the possible upside and downside risk.  It also contains the GLA Economics forecast for output, employment, household expenditure and household income in London

Selected findings from the report:

London’s economic output contracted at an annualised rate of -3.6% in quarter one of 2009 compared to -5.2% in the UK. Annual economic growth in London has been stronger than the UK as a whole since the third quarter of 2004

Annual employment growth in London remained negative in the second quarter of 2009 at -1.4% compared to -1.1% in the previous quarter. The total number of workforce jobs in London was just over 4.6 million in quarter two 2009

Public transport usage can provide a usage is a useful and timely indicator of economic activity in London.  This year has seen a continued slow down in the annual growth in the moving average of both bus and underground usage.

Annual house price inflation slowed in the second half of 2007 and turned negative in 2008, although there have been recent signs of some improvement in the market. Still with tightened lending criteria, subdued lending, and the continued economic downturn, house prices are likely to remain restrained for some time yet. Annual house price inflation in London as measured by DCLG, the Halifax house price index and Nationwide was very negative in the second quarter of 2009 and was close to the picture seen in the rest of the UK.

Click here to read the full report

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The 5th Global Economic Crime Survey

This survey from PwC investigates the root causes of economic crime and the way in which it affects businesses worldwide. More than 3,000 respondents in 54 countries completed a web-based survey. The aim of the survey was primarily to asses corporate attitudes towards economic crime in the current economic environment in order to understand how economic crime changes during a downturn.

Selected findings:

Despite the attention of regulators and companies' investment in controls, fraud remains one of the most problematic issues for companies around the world. 

The actual level of economic crime and associated financial and non-financial losses has not decreased. One third of companies fell victim to economic crime in the past twelve months.

Accounting fraud has increased.  This encompassed a variety of fraudulent activities including accounting manipulations, fraudulent borrowing/raising of finance, fraudulent application for credit and unauthorized transactions/rogue trading. Relatively high levels of bribery and corruption were also reported by respondents from the engineering and construction industries (47%) and energy and mining industries (43%)

Organisations that experienced economic crime reported that 53% of perpetrators were internal and 44% were external. The profile of the internal fraudster has changed with middle managers accounting for 42% of economic crimes, up 26% in 2007. 

The industry sectors that reported most economic crime are communications, insurance, financial services and hospitality and leisure.

The report concludes that companies cannot rely on fraud controls alone to detect and deter economic crime. Companies need to build loyalty to the organisation, give employees the confidence to do the right thing, and put in place clear sanctions for those who commit fraud, regardless of their position in the company.

The full report can be downloaded from PricewaterhouseCooper’s website

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Qualitative Study into Machine Gamblers

The Gambling Commission commissioned GfK NOP Social Research, working in partnership with Dr. Mark Griffiths (Professor of Gambling Studies at Nottingham Trent University), to undertake qualitative research with British machine gamblers. The research examined players’ motivations and the potential impact of social responsibility measures. Its overall aim was to provide the Gambling Commission with an exploratory look at the impact of gaming machine features on problem and non-problem gamblers in Britain.  The research found that machine gambling behaviour is affected by three main types of characteristics: personal, structural and situational.  Within these categories, a number of factors were found to be key drivers of machine gambling behaviour:

Personal
Enjoyment: including escapism and the thrill and excitement of machine gambling motivated by its speed and the sense of real-time risk.

Social: for many machine gambling was seen as a social activity while for problem gamblers it tended to be more solitary

Mastery: there was a perception amongst players that through continual playing  ‘tricks’ could be identified to increase the likelihood of winning.

Financial: problem gamblers often played to win (or would chase their losses), while regular gamblers usually saw money as a way of facilitating continued play.

Structural:
Near miss1: perceptions of a ‘near miss’ encouraged people to continue playing and sometimes to extend their pre-defined budget for that particular day.

Speed and simplicity: the instantaneous thrill and real-time risk of machine playing was intensified by speedier and simpler games.

Frequency of payout: many were encouraged to continue playing when they won small payouts, as it made them feel that they were on a lucky streak.

Situational
Machine density and access: all machine gamblers believed that machines were easy to access and cited a range of venues where they could play the gaming machines in their local area. The availability of machines was not considered a barrier to machine gambling.

Presence of others: as identified above, some were attracted to a specific venue due to the opportunity it provided for social interaction; problem gamblers often preferred more solitary, asocial gaming environments.

Click here to read the full report

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European Business: Facts and Figures 2009

This publication from Eurostat provides a comprehensive picture of the structure, development and characteristics of the European business economy and its different sectors. It presents the latest available statistics from a wide selection of statistical sources. The main source of analysis is derived from structural business statistics (SBS).  Other data sources which are used extensively throughout the publication include short-term statistics (STS), the labour force survey (LFS), PRODCOM (statistics by product) and external trade.  In addition, use has also been made of specialist sources for particular areas, notably transport, energy, research and development, environment, tourism and information society statistics.

The report covers: production and employment; country specialisation and regional distribution; cost structure, productivity and profitability; external trade, and more. It divides ‘the business economy’ into 25 main sectors from mining and quarrying, through manufacturing activities, to energy transmission and recycling, construction and a range of services. Each of these sectors are analysed in detail in separate chapters.  It does not cover agriculture, forestry and fishing, nor the public administration and largely non-market services such as education and health.

The first chapter provides a general overview of the EU’s business economy, with comparisons across the main sectors. In addition, it provides information of a horizontal nature based on data on business demography and foreign controlled enterprises, as well as size class analysis of enterprises’ population. A particular effort has been made in this edition to include, where available, data at the most detailed activity level (NACE Rev. 1.1 four digit or class level) and to facilitate further comparisons across the different activities of the business economy.

Click here to see the full report

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State of Internet Security, Q1-Q2 2009

The latest Security Labs report from Websense has found that Web 2.0 sites are increasingly being used to carry out a wide range of attacks.  Efforts to self-police these sites have also been largely ineffective. Websense research showed that community-driven security tools (asking users to report inappropriate content) on sites like YouTube and BlogSpot are 65% to 75% ineffective in protecting Web users from objectionable content and security risks. Their research also discovered that over 200,000 phony copycat sites have been created, all including the terms Facebook, MySpace or Twitter in their URLs. These sites are created in order to take advantage of the huge number of users of social networking sites. Facebook copycat sites lead the sector with more than 150,000 known fake URLs.

Attackers also capitalized on major events during the last six months, such as the economic recession, to take advantage of job seekers looking for employment by using various exploits to infect victims’ computers.  Similarly, celebrities and politics continued to be used as lures by spammers and cybercriminals. At the end of June, the sudden death of Michael Jackson prompted spammers to send malicious email messages using news of the event as a social engineering technique to lure people to their sites.

Other highlights from the report:

• Websense Security Labs identified a 233% growth in the number of malicious Web sites in the last six months and a 671% growth during the last year. 

• 61% of the top 100 sites either hosted malicious content or contained a masked redirect to lure unsuspecting victims from legitimate sites to malicious sites.

• 95% of user-generated comments to blogs, chat rooms and message boards are spam or malicious.

• 87.7% of email messages were spam, representing a 3% increase over the last six months.

• Shopping remained the leading topic of spam (28%), followed closely by cosmetics (18.4%), medical (11.9%) and education (9.5%). Education themed spam has nearly doubled over the previous period and may be related to the recession as spammers seek to exploit people looking to gain new skills or obtain fake qualifications to help their job prospects.

Click here to read the report in full

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Renewable energy 2009

This Key Note Market Report analyses the UK renewable energy market, with particular emphasis on biomass, hydropower, wind/wave power and solar energy. UK renewable energy use in 2008 was 5.9 million tonnes of oil equivalent (toe), an increase of 14.4% on the previous year. Biomass was the main contributor to this total, with the next most significant renewable sources being transport fuels, wind power and hydropower. Recent years have shown rapid growth in wind power, especially offshore wind farms.  There has also been strong growth in renewable transport fuels (biodiesel and bioethanol). Generation of electricity is the major use of renewables, the main sources here being landfill gas, followed by wind and wave power and hydropower. The use of renewables for generating heat is dominated by biomass (mostly wood combustion).

Key Note suggests that the market for renewable energy is being driven by two main factors: energy security and a reduction in carbon emissions. Energy security is becoming a more significant factor as output from the UK’s offshore oil/gas industry decreases. Unless changes are made to the UK’s energy sourcing strategy, more imports of fossil fuels would be required to make up for this decline in indigenous production.

In terms of reducing carbon emissions, in July 2009 the Government published The UK Renewable Energy Strategy to show how the UK can reach its goal of producing 15% of its energy from renewables by 2020.  The UK Low Carbon Industrial Strategy, another government report also published in July 2009, gave details of the UK’s commitment to reduce its carbon emissions by at least 26% by 2020 and 80% by 2050. Again, this will involve a major contribution by the renewable energy market (as well as nuclear power). Nuclear power has now received the government go-ahead and major energy companies are planning to renew the UK’s ageing nuclear power stations.

This report is available to current London Business School staff, students and faculty from Key Note Online which can be found on the A-Z list of library databases within Portal

A hardcopy of this report can be found in the market reports collection located on the first floor of the library.

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The Carbon Management and Offsetting Trends Survey Results 2009

This report from EcoSecurities in partnership with ClimateBiz and Baker & McKenzie provides an authentic insight into the thoughts and opinions of multinational and regional organisations with regards to carbon management strategies and offsetting. Furthermore, the report examines the critical factors which drive end-users to purchase carbon offsets as well as the buyers’ desires in terms of project type, location and standard. This year’s survey involved over 300 corporations, covering a wide variety of geographies and industry sectors.  Specifically, 280 responses were received from a diverse range of organisations and an additional 31 responses received from carbon companies. Encouragingly, despite the gloomy outlook for the world’s economy in 2009, green issues have remained high on the agenda with both senior management and corporate boards.
 
Some of the key findings include:

Over three quarters of companies have implemented or have started developing a carbon management strategy

Two thirds of respondents have already offset their carbon emissions or will consider offsetting in the future

Environmental benefits (91%) were highlighted as one of the main motivations for interest in carbon offsets, closely followed by carbon neutrality and marketing (89%)

72% of participants nominated the US as the most desirable geographic region for purchasing offsets; this may reflect the desire for domestic projects as 56% of the respondents came from North America. Africa and South America were also rated as highly desirable locations for emission reduction projects

Respondents prefer renewable energy projects above any other project type with solar scoring 92% and wind 86%

The full report can be downloaded from the EcoSecurities’s website (pre-registration required)

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Deloitte Technology Fast 50

The Deloitte Technology Fast 50 is an annual ranking of the UK’s 50 fastest-growing technology companies based on percentage revenue growth over five years. Deloitte launched the programme over a decade ago to celebrate the world-class achievements of the UK technology sector. The Technology Fast 50 awards are all about revenue growth driven by leading intellectual property, and are a celebration of innovation and entrepreneurship.  This year digital service companies are thriving as the Web continues its advance into every aspect of modern life. They have overtaken software companies dominated last year’s ranking. In this year’s Deloitte Technology Fast 50, internet companies take 21 of the top 50 slots.

This year’s winner is Distribution Technology, a company that provides financial planning and sales technology to financial institutions such as banks and insurers, large IFAs, and Distributors.  The Reading-based company has achieved a staggering 18,225% growth rate. Founded in 2003, Distribution Technology supplies a range of financial software products that enable qualified advisors to pinpoint key products and cross-sell others to customers faster, more efficiently and more compliantly.

In second place, Heart Internet Ltd has seen a spectacular annual growth rate of 8548% over the last five years.  Based in the Midlands, the company provides hosting and domain name registration to individuals, SMEs and resellers, with the latter making up about 50% of its customer base. Heart is currently responsible for more than 400,000 domains and employs 40 people.

Third on the list is ApaTech, a London-based orthobiologics company which has seen rapid expansion in the last eighteen months drive the business to a five-year growth rate of 8318%
The company was spun out of Queen Mary, University of London research into synthetic bone graft technology in the 1990’s, which generated a variety of commercially-viable IP.

Companies must fit the following criteria:

• It must have been in business for a minimum of five years;
• It must be considered a technology company, which is defined as: producing technology; manufacturing technology-related products; be technology intensive, or use unique technology to solve problems
• The company must devote a high percentage of effort to technology R&D;
• The parent company must be UK-owned with its headquarters in UK (subsidiaries of multinational organisations do not qualify);
• Operating revenues must be at least £34,000 (50,000 Euros) for financial year 2004 and £540,000 (800,000 Euros) for financial year 2008.

Click here to see the full list

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Equality in Higher Education

This report from the Equality Challenge Unit is based mainly on analysis of Higher Education Statistics Agency (HESA) data for the 2007/08 academic year relating to gender, ethnicity, disability and age. It covers staff, students and graduates in UK higher education institutions (HEIs). The report also includes some aspects of time series, covering the past five years’ data, 2003/04 to 2007/08

Selected findings:

Across all types of staff within HEIs, women were in a slight majority at 53.2% in 2007/08. Representation of women varied markedly between different occupational types. Highest levels of representation existed within the support and administration occupations whereas lowest representation was seen within the technician, manual and craft areas.  Representation of women was lower in senior academic-grade groups than in less senior ones. Women made up 18.7% of staff at professor/head of department grades in 2007/08 compared with 45.4% for other grades.

For all staff in 2007/08, 6.4% reported their ethnicity within the black and minority ethnic (BME) group. This showed an increase from the 2003/04 figure of 5.4%.  The largest single ethnic group was Asian or Asian British, amounting to 33.8% of all BME staff.  Within academic staff, the percentage of BME staff stood at 6.4% in 2007/08. BME staff were less likely than white staff to be in senior academic grades. 9.7% of BME academic staff were at professor/head of department grades in 2007/08 compared with 12.1% of white academic staff.

Over the past five years, the proportion of male students compared with female students has remained relatively stable, with women outnumbering men. In 2007/08, females made up 57.1% of the student population with the remaining 42.9% being male.  In general, women were more likely to obtain a higher class of degree than men, with 63.8% of females obtaining a first or upper second class honours degree compared with 58.2% of males.

The proportion of BME students studying at HEIs has gradually increased from 14.9% in 2003/04 to 17.2% in 2007/08. The largest BME group was Asian across all years (when Asian or Asian British, Chinese, Other Asian).

The age profile of students has changed slightly, with the population generally becoming slightly younger. The proportion of students aged 21 and under on entry has grown steadily from 45.4% in 2003/04 to 47.7% in 2007/08.

The full report can be downloaded from the ECU website

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