There’s no doubt that 2011 has been a tumultuous year in just about every commercial sector. The headlines have been dominated by volatile financial markets, high-profile corporate bankruptcies and a flat-lining of consumer confidence. Yet it’s not all been bad news, and strong performances from a number of companies bodes extremely well for the future, clearly demonstrating what UK firms will be able to achieve when the global economy finally gets back on track. So just who were the winners and losers in 2011?
All change in healthcare
The healthcare sector has seen major changes over the past 12 months, and the recently announced spending cuts have undoubtedly put healthcare professionals under enormous pressure. Yet at an operational level the response has generally been quite positive, underlining the enduring professionalism of practitioners. In the private healthcare sector confidence has been rocked by the collapse of Southern Cross. But overall the industry has performed well, with many companies achieving strong growth, although perhaps not fast enough to create opportunities for all the NHS staff who face the risk of redundancy.
Plenty of optimism in construction
2011 has been a year of consolidation within the construction industry, with firms keeping a close eye on spending and a tight focus on driving greater efficiencies. Yet despite the tough conditions there have been a number of success stories, particularly in house building where many firms have reported excellent results and healthier margins. However, the industry remains at the mercy of the banks who have yet to relax lending criteria – particularly for first-time-buyers who form the foundation of growth in the sector. The outlook for 2012 looks relatively bright, with a range of government-backed initiatives set to roll out. Property consultancies also look set to enjoy another good year, particularly those focused on economic regeneration and renewable energy projects.
Strong performances in oil and gas
Although the past 12 months have seen energy demand and prices fluctuate in parallel with the stop-start global economy, 2011 has generally been a very good year with many of the sector’s larger companies reporting healthy margins, and the new wave of renewable energy providers reporting record levels of growth. 2012 looks set to be even brighter, with many new projects already underway in new technology development, exploration and distribution. So construction companies and consultancy firms should be kept very busy for the foreseeable future.
IT and Technology – onward and upward
IT and technology companies continue to report strong figures despite the economic downturn, and it remains one of the few sectors where there is a genuine shortage of experienced professionals with the skills to match demand. The industry continues to evolve rapidly, particularly in social media which continues to grow at an astonishing pace, highlighted by the $100 billion valuation of Facebook for its planned 2012 flotation!
An uncertain future for the public sector
2011 has seen unparalleled changes within the public sector as spending cuts begin to bite and government looks to impose radical changes in every area. Employees have been hit by a squeeze on pay and benefits, and services have been equally hard hit. Yet this is perhaps just the tip of the iceberg. As government considers the feasibility of some services, and a possible transfer of assets to the private sector, the outlook for 2012 remains unsettled with further squalls on the horizon.
Financial Services – time to get house in order
2011 has seen further turmoil within the financial services industry, with large chunks of some of the UK’s leading brands remaining in public ownership. While government intervention has so far been very light-touch, the threatened action over executive bonuses demonstrates a potential change of direction. However, as a major engine of growth for the UK, the banking sector clearly enjoys strong government support, as evidenced by the Prime Minister’s actions at the recent EU summit. The next 12 months will be key for financial services as new regulation comes into force and government seeks to shift more publicly held assets back into the private sector.
Retail – tough times ahead
The retail sector has suffered another difficult year with even more high-street brands going into administration. Barretts is the latest in a long line of well-known brands to experience first-hand the grip of the impending recession. Many retailers are praying for a good Christmas trading period and an easing of rents come the new year. Online retailing remains relatively strong however, so those brands that can diversify across new customer channels may be well placed to survive and prosper.
2011 has been rewarding for some, challenging for most. The outlook for 2012 is unclear, and the fate of many companies lies outside of their control. Much rests on the fate of the Euro, the willingness of banks to lend, and on hopes of a global recovery. It’s very much wait and see.