Strong year for inward investment boosts economic recovery in Newcastle and Gateshead

Although economic uncertainty and changing restrictions characterised the year for businesses across the country, Invest Newcastle, part of NewcastleGateshead Initiative (NGI), ended the 2021-22 financial year having supported the creation and safeguarding of more than 1,700 jobs.

From April 2021 to March 2022, 29 new businesses and 11 existing businesses chose to invest, locate, or expand their operations in Newcastle and Gateshead creating a combined total of 1,406 new jobs and safeguarding 379. This was despite the slow return of international inward investment visits, reflecting the growing national and international reputation the region has built across key sectors. This was also a record year for foreign direct investment with companies from the US, Japan and Ireland creating hundreds of highly skilled jobs.

This year the annual FDI European Cities and Region of the Future report ranked Newcastle as the fourth best mid-sized European city of the future, Newcastle’s position reflects the success of the city and its ability to attract international investment.

Having been ranked the ninth most important tech hub in a report by Tech Nation as well as the UK’s smartest city in the IMD Smart City Index 2021, this year saw a boom in the number of digital and tech businesses who chose Newcastle as a base, making up 48% of the total new investments.

Invest Newcastle supported the likes of digital and tech consultancies, Thoughtworks, Monstarlab, Version 1 and BJSS as well as cyber security firm, Arctic Wolf in their moves to the city. Many hailed the region’s friendly and hardworking culture as well as proximity to specialist assets including the UK’s National Innovation Centre for Data (NICD), National Innovation for Ageing (NICA), two research-intensive universities and world-class NHS trust, as reasons for their decision. Many of these companies were successful in securing funding from the North of Tyne Combined Authority’s Inward Investment Fund. In total £2.3m was awarded in 2021-22 with the support of Invest Newcastle.

The life science cluster has gone from strength to strength this past year with The Biosphere, a specialist lab facility dedicated to the commercialisation of life sciences on Newcastle Helix, at the heart of recent growth.

AMLo Biosciences, CellulaREvolution, Atelerix, LightOx, Newcells Biotech and Iksuda Therapeutics, all tenants in The Biosphere, have raised a combined total of almost £50m over the last 18 months to expand their activity in Newcastle. The demand in this sector has meant wheels are now in motion to bring forward a new commercial lab and office space for spinouts, growing start-ups, SMEs, and established businesses within the city’s thriving £1.7bn ecosystem.

In response to the demand of digital and tech and life science sector enquiries, and through the North of Tyne Investment Fund, Invest Newcastle also welcomed two new team members. Dawn Dunn and Becky Crow, Senior Inward Investment Managers for digital and tech and health and life sciences respectively will continue to attract investment and new companies to the region within these two strategic sectors.

Despite the economic impact of Covid-19, Invest Newcastle supported 11 businesses to expand their operations in the region. This not only created jobs but has reinforced Newcastle, Gateshead, and the wider region’s reputation as a place for companies to thrive and grow.

Significantly, it was announced in November that HMRC will move its operations and 9,000 staff to Pilgrim Quarter in Newcastle city centre, in one of the city’s biggest ever office moves, and which will also support the economic recovery of hospitality, transport and leisure in the city centre.

After two years away from the national and international conference scene, Invest Newcastle came back with a bang, leading a 60-strong delegation to global real estate conference, MIPIM in March 2022.

Thought leaders and delegates across 22 public and private sector organisations came together to showcase everything Newcastle, Gateshead and the wider region has to offer investors, developers, and businesses. Recent transformational investments such as the £350m Arena, Conference and Exhibition Centre, The Sage and the £25m commitment to the North East by the BBC, were all highlighted at the conference.

Councillor Alex Hay, Cabinet Member for a Resilient City, Newcastle City Council, said: “Newcastle is a resilient city with a business community that really pulled together and collaborated when we needed to most. It’s this culture along with our world-class assets which have continued to attract high levels of investment over the past year.

“Inward investment and business growth creates opportunities and jobs for the people of Newcastle, accelerates the growth of our economy and creates a sustainable future for all.”

Councillor Malcolm Brain, Cabinet Member for Economy, Gateshead Council, said: “It’s an exciting time for the region with both local and global investment into projects designed to regenerate the North East. The economic recovery has been faster than we’d anticipated after years of global uncertainty, and we will continue to be resilient through the cost of living crisis.

“In Gateshead our strengths in Immersive Technology, film and media have proven reliant as both sectors grow; the growth brings employment opportunities allowing for retention of the wonderful talent we have in the North East and an opportunity for our residents to thrive.

“As we look to the future with the support of North East Screen and the Memorandum of Understanding (MOU) signed by the BBC we continue to see our Gateshead companies thrive and opportunities for all created. In 2024 the opening of the Sage Arena, Conference and Exhibition Centre will be a catalyst for the regeneration of Gateshead and the region with the creation of long-term employment opportunities and businesses benefitting from the increase in visitors.”

Jen Hartley, Director of Invest Newcastle at NewcastleGateshead Initiative, said: “After another trying year grappling with changing restrictions and economic uncertainty, the high level of foreign investment we have attracted has been vital in supporting the region and its people as we recover, creating jobs and inclusive opportunities for all.

“Our strengths in digital, tech and life sciences and our growing cluster of clean tech businesses have remained resilient throughout the pandemic with cross-sector collaboration and innovation supporting the region’s Net Zero goals and public health recovery. We’re a region that cares and supports one another and this has been reflected by the businesses moving here and indigenous businesses further committing to the city through acquiring greater office space and growing their teams.

“The commitment from the BBC and twelve North East and Tees Valley local authorities to develop the screen industry in the region will be transformational for the creative sector. We are already seeing enquiries and private sector investments being made off the back of this and it will mean greater and more secure career opportunities for those living and working in the creative industries here in the North East.

“I’ve been filled with pride this year as we were finally able to show off our region’s strengths to international investors, heading to MIPIM but also welcoming delegations from Qatar, the Nordics, and Portugal to Newcastle. Having just announced a further 200 jobs for the region with tech consultancy Credera, I am confident that we have a bright future ahead, and will continue to bring excellent opportunities to the people of the North East.”

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