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The Case for Career Advocates: An Organization Is Not a Meritocracy
This blog post is the first in a three-part series by Renee Dye 94PhD, associate professor in the practice of Organization & Management that summarizes the key messages she delivers to students in the hopes that it can catalyze and support the career success of a broader group of ambitious employees who aspire to make it to the C-Suite One of the paradoxes of the GenZs and Generation Alphas is their intuitive understanding of the phenomenon of social media…at the same time they maintain an almost ideological conviction that the workplace – apart from systemic biases – is otherwise a meritocracy, where talent is perfectly and objectively evaluated – and the best and most deserving rise to the top. Surely a cursory exploration of Instagram and TikTok would convince even the most skeptical of the fundamentally idiosyncratic nature of success in a networked world? The Real World is likewise characterized by outcomes in which success is imperfectly correlated with capability level. Someone whose capability level is less than yours may lap you in the race to the top of the organization. That may seem unfair, but that’s because you’re making the mistake of assuming that career success is predicated purely on capability. A survey of MBA graduates from Emory University's Goizueta Business School a few years ago produced a startling insight: of all the skills that we provided to our students during their MBA tenures, our students felt most unprepared to navigate “organizational politics” in their careers. The reason that I found this fact so astonishing is that today’s students, who are Digital Natives and in part Social Media Natives, are the most connected and self-promoting generation the world has ever seen. Yet today I find that my students continue to exhibit little practical understanding of how career success is forged…so much so that I now devote an entire class session in my core Strategy class to demonstrating the importance of relationship management and advocacy cultivation. Capability is not unimportant; far from it. As I tell my students, though, capability is table stakes these days as the level of education and skill sets continues to advance among individuals. If you’re not smart and capable you’re not getting in the door. But once you’re in, your career path and ultimate career success will be more determined by (1) your level of aspiration and unflagging commitment to achieving your goals; (2) your performance outcomes in your individual roles; (3) your work ethic and conscientiousness; and (4) the relationships you have with other people within your organization. And the relationships that matter the most are the individuals with influence and power over your future career opportunities. Let me put it starkly: without career advocates (notice the plural), it will be much, much harder to make it to the senior management ranks. Full stop. Some facts to bear this assertion out: • People with advocates are 23% more likely to move up in the careers • Women with advocates are 22% more likely to ask for a stretch assignment to build their reputations as leaders Ultimately, having an advocate confers a career benefit of 22-30%, depending on who’s doing the asking and what they’re asking for. That’s increasing your odds of making it to the C-Suite by nearly a third! If anecdotal evidence is more your thing, here are a couple of quotations for you: • A lot of decisions are made when you are not in the room, so you need someone to advocate for you, bring up the important reasons you should advance” (Catalyst Survey, as quoted in Elizabeth McDaid, “Mentor vs. Sponsor,” September 3, 2019) • When you get to the level in your career when decisions are not just being made by an individual manager, feedback from other leaders becomes crucial. Rosalind Hudnell, Chief Diversity Officer, Intel. As quoted in Hewlett, Sylvia Ann, Melinda Marshall, and Laura Sherbin. “The Relationship You Need to Get Right,” HBR 2011) • “I was great at building businesses and had tons of cheerleaders, but I had that typical Asian keep-your-head-down-and-you’ll-get-taken-care-of mindset.” My boss had to take me aside and tell me that if I didn’t actively cultivate her as my sponsor, I would never progress beyond senior associate” (quoted in Hewlett, Sylvia Ann, Melinda Marshall, and Laura Sherbin. “The Relationship You Need to Get Right,” HBR 2011) To reiterate: an organization is not purely a meritocracy where talent and hard work speak for themselves; and it’s much, much harder to advance within an organization without effective advocates. "This blog post is the first in a three-part series that summarizes the key messages I deliver to my students, in the hopes that it can catalyze and support the career success of a broader group of ambitious employees who aspire to make it to the C-Suite,” writes Renee Dye 94PhD, associate professor in the practice of Organization & Management. “Most of my lessons are derived from my own unlikely personal journey from literary scholar to top-tier management consultant to C-suite executive for a publicly traded company, but they are also heavily informed by leading researchers like Sylvia Anne Hewlett. In the final blog, I discuss the impact of remote work on career success.” For more insight and to continue reading this article and series, please visit Dye’s blog. To arrange an interview – simply click on Dye’s icon now to book a time today.
Millennials at Work – Let our experts offer insight into the next generation of employees
Millennial workers now total 56 million, representing 35% of the total US labor force. How can organizations harness their unique talents and strengths? Goizueta Professor Andrea Hershatter recently joined the Goizueta Effect to explore this generation’s use of technology as a “sixth sense,” their inherent trust in organizations, and their tendency toward an extrinsic sense of fulfillment. In the interview Hershatter uses her expertise and years of experience to discuss a wide variety of topics such as: Defining Generations What Makes a Millennial? Exploring Boomers, GenX and Zoomers Millennials’ Relationship with Technology & Organizations How COVID-19 Has Impacted Millennials Dynamics & Interplay Between Generations The Next Generation and The Future Andrea Hershatter is Senior Associate Dean and Director of the BBA Program in Emory’s Goizueta Business School. She regularly provides consultation to corporations and academia on the Millennial generation and has been an outside expert to the Graduate Management Admission Council in enhancing undergraduate student outreach. She is a frequent presenter on the topics of entrepreneurship, generational workplace culture, and management education. Andrea is available to speak with media about this topic – simply click on her icon now to arrange an interview today.
When it comes to marketing, the endgame is almost always to increase brand awareness, strengthen relationships between companies and consumers, and boost market share. But counter-marketing efforts are often employed to reduce consumption of “vice” goods such as cigarettes, sugary sodas, and fast food. Earlier this year, Michael “Mike” Lewis, professor of marketing, faculty director, Emory Marketing Analytics Center, published “Investigating the Effects of Excise Taxes, Public Usage Restrictions, and Anti-Smoking Ads across Cigarette Brands.” in the Journal of Marketing. Mike, along with co-authors, Yanwen Wang PhD14, associate professor of marketing and Canada research chair in Marketing Analytics at the University British Columbia, and Vishal Singh, professor of marketing, Leonard N. Stern School of Business, New York University, took a closer look at the role counter-marketing plays in the consumption of “vice” goods. Given that many “vice” categories are dominated by high-equity brands such as Marlboro, McDonald’s, and The Coca-Cola Company, the authors wanted to explore whether or not strong brands “might also affect the efforts of advocacy groups and regulators to disrupt these relationships and reduce consumption,” they note in their paper. The research focused specifically on the interplay between branding and counter-marketing with respect to cigarette consumption. By focusing on brand manufacturers rather than on regulators and consumers, the authors believe they’ve closed a gap. “The literature on smoking cessation has largely ignored the impact of branding on efforts to reduce cigarette consumption,” they write. “This is an oversight given that marketing researchers have found that brand-consumers’ relationships have significant effects on consumer decision-making.” A full article on the research is attached and is well worth the read. In that piece, readers will learn more about how the researchers expected that strong brands would take advantage of their increased customer loyalty and diminished price sensitivity to protect them from counter-marketing tactics. And while it might be counter-intuitive, the author’s research suggests that market leading cigarette brands would be better off pushing for excise taxes on cigarettes (versus smoking restrictions), as such tax increases would be attractive to government agencies (by increasing government revenue), and big brand cigarette companies would capture more market share. In other words, when it comes to combating counter-marketing efforts, “brand managers may devise strategies or lobbying efforts based on their category position,” suggest the researchers. “This isn’t a clear-cut battle of good versus evil. It’s more a matter of a brand’s people advocating for one position,” said Lewis. “A position that’s going to make them more resilient to some of these tactics.” In addition to big brand cigarette companies, the paper’s findings have implications for brands that anchor other vice categories, such as McDonald’s and The Coca-Cola Company, entities that have been the target of counter-marketing campaigns by various anti-obesity groups. According to Lewis, Wang, and Singh’s research, much of the response by these brands to the counter-marketing attempts has been centered around public relations, but the authors see opportunities to employ “different tactics” that are “appropriate for different brands,” they write. "Relationships between consumers and relatively weak brands may be disrupted using taxes, while for strong brands, the appropriate tactic seems to be usage restriction that limit public consumption. Our results suggest that brand building is the correct response to taxes, whereas usage restrictions would call for other responses, such as lobbying.” If you are a reporter looking to know more about this subject or if you have questions, then let our experts help. Professor Michael Lewis is an Associate Professor of Marketing at Emory University’s Goizueta Business School. In addition to exploring trends in the overall marketing landscape, Lewis is an expert in sports analytics and marketing. He is available for interview - simply click on his icon to arrange a discussion today.
Early-stage entrepreneurial activity in 2020 had fallen sharply from its pre-pandemic high in the UK as the economy was essentially shut down for long periods due to COVID-19 This decline was due to fewer nascent entrepreneurs than normal – that is, individuals in the first three months of starting their new business venture Nevertheless, around two-thirds of working-age adults looking to set up a business within three years said the pandemic had influenced their decision to re-assess their future engagement with the labour market As in previous economic downturns it is the small business community that drives the recovery across all sectors of the economy. UK entrepreneurs once again stand ready to rise to the challenges and opportunities created by the Coronavirus pandemic and the economic fallout from Brexit, a new report says. The latest Global Entrepreneurship Team (GEM) UK report found that although around of half budding entrepreneurs said that the UK government had so far dealt effectively with the economic consequences of the pandemic, there must be improved programmes, financial support and advice to start-ups and scale-ups through different stages of the business life cycle. GEM is the world’s largest survey of entrepreneurship and is the only global research source that collects data on entrepreneurship directly from individual entrepreneurs. It measures various rates of entrepreneurship in 43 countries in 2020. GEM’s UK team – which is led by Professor Mark Hart of Aston University – compared attitudes, activity and aspirations in the UK, Germany and the United States as well as the four home nations of the UK. Access to finance remained one of the major obstacles to entrepreneurial activity in the UK. Enhanced tax benefits for entrepreneurs, such as tax breaks for start-ups and businesses in difficulty to reduce early exits and better tax incentives for recruitment, investment in managerial and digital practices and skills were also highlighted1. The report also called for more entrepreneurial education, especially at school age as well as improved technical education and improved links between the educational system and industry to boost growth post-COVID and post-Brexit. It found that the UK still lags behind many comparable economies in this respect. Mark Hart, professor of small business and entrepreneurship at Aston Business School and deputy director of the UK’s Enterprise Research Centre, said: “The GEM survey undertaken in the last few months of 2020 showed a sharp fall in the number of individuals in the early stages of setting up a new business compared to the pre-pandemic high in 2019. “This is hardly surprising, but the analysis has also shown that the entrepreneurial foundations of the economy and society are still strong and these will be crucial for the recovery after the pandemic and in dealing with the ongoing economic fallout from Brexit. “Those ethnic-minority communities that have borne the brunt of the pandemic in terms of infection, hospitalisation and sadly deaths demonstrated their resilience by maintaining their previous levels of early-stage entrepreneurial activity (TEA rate) which were significantly higher than for the non-ethnic minority population. “Clearly, the pandemic has had no damaging impact on the level of entrepreneurial activity by immigrants and ethnic-minorities although it has depressed it for life-long residents and the non-ethnic population. “There is undoubtedly an appetite for people to start their own businesses in the next three years and many report new opportunities because of the pandemic but they are delaying the actual decision to get the business operational.” The full GEM UK impact report, sponsored by NatWest, is available for download here.
Aston University researchers based in the College of Health and Life Sciences have been awarded a Knowledge Transfer Partnership (KTP) project by Innovate UK, to bring its academic and scientific expertise to assist Catalent in the development of its Zydis® technology, the leading orally disintegrating tablet (ODT). The Zydis ODT fast-dissolve formulation is a unique, freeze-dried oral solid dosage form that disperses almost instantly in the mouth with no water required. It helps delivering treatments to patients and consumers who have difficulty swallowing conventional pills, or where rapid onset of action is desirable. The aim of the KTP partnership is to develop and prove an accurate predictive decision-making tool to pre-determine accurate levels of absorption enhancer for each Zydis product, potentially facilitating faster pharmaceutical development, improving efficiency, and reducing time to market. A Knowledge Transfer Partnership (KTP) is a three-way collaboration between a business, an academic partner and a KTP Associate. The UK-wide programme helps businesses to improve their competitiveness and productivity through the better use of knowledge, technology and skills. Aston University is the leading KTP provider within the Midlands. Academic lead on the project is Professor Afzal Mohammed, who is also chair in Pharmacy in the College of Health & Life Sciences (HLS) and a member of the Aston Pharmaceutics Group (APG) at Aston University. Afzal said: “This is a great opportunity for us to share and translate our academic experience in cell based models, excipient and formulation characterisation to develop an evidence based predictive tool that has the potential to expedite product development at Catalent.” Ralph Gosden, head of Zydis product development at Catalan, added: "We are excited to be working with Aston University on this project. Their expertise in drug transportation, cell biology, data analysis and model cell line design, coupled with its world-class facilities means that together, we will be able to achieve significant improvements in efficiency, and accelerate new product development.” Professor Mohammed will be supported by other colleagues from the Aston Pharmaceutics Group, including, Dr Dan Kirby, who has experience in drug delivery and improving patient acceptability of dosage forms gained through original research; Dr Affiong Iyire who has research expertise in the formulation of drugs for pre-gastric absorption and innovative cell models; and Dr Raj Badhan, who is a pharmacokinetics expert with vast knowledge of in silico methods. The outcomes of the project will be integrated into Aston University’s curriculum through teaching case studies, thereby developing well equipped graduates.
The use of swear words declines by more than a quarter in the UK since the 1990s – new research
Aston University’s Dr Robbie Love compared the use of 16 of the most common swear words between 1994 and 2014 He found the amount of swearing has fallen by 27.6 per cent during the 13-year period The study also found that the f-word has overtaken 'bloody' as UK's most popular curse word Researchers from Aston University have found that the use of swear words in Britain has declined by more than a quarter since the 1990s. Dr Robbie Love, based in the College of Business and Social Sciences, looked at how swearing changed in casual British English conversation between 1994 and 2014. As part of the study, which is published in Text & Talk: An Interdisciplinary Journal of Language, Discourse & Communication Studies, Dr Love used two large bodies of transcriptions to analyse the use of language, including: The Spoken British National Corpus gathered in 1994 and the same corpus from 2014. Both texts include over 15 million words, although it was found that swear words accounted for less than one per cent. In total, the amount of swearing was found to have fallen by 27.6 per cent, from 1,822 words per million in 1994 to 1,320 words per million in 2014.The research findings also suggest that the f-word has overtaken 'bloody' as the most popular curse word in the UK. In the study, Dr Love compared the use of 16 of the nation's most common swear words, including p***, c*** and s**g, from the 1990s to the 2010s. He also found that trends in the type of swear words used have changed over the last few decades , with 'bloody' being the most common curse word in the 1990s and the f-word taking precedent in the 2010s. The analysis suggests that this is largely down to a big decline in the use of 'bloody',while the f-word has remained relatively steady over the years. It was also found to be the second most commonly used swear word in 1994, followed by s**t, p***, b****r and c**p. Other key findings of the study included: Over a twenty year period b****r had fallen from the fifth most common curse to the ninth, while b*****d dropped from seventh to 10th. The big climbers include s**t, from third to second, a**e, from eighth to sixth and d***, from tenth to seventh. T**t also rose from the 16th most common swear word in the 1990s to 13th by the 2010s. Dr Love then analysed demographics and discovered that, although swearing is more common in men than women, the difference between the genders has decreased notably from 2.33 times more frequent in men in 1994 to 1.68 times in 2014. Another change concerned how much people swear as they age. In both data sets, swearing is most common among people in their 20s, and then declines with age. However, the decline was less steep in the 2010s, suggesting that people continue swearing later in life more than they did in the 1990s. Dr Robbie Love, lecturer in English at Aston University, said: “This research reinforces the view that swearing plays a part in our conversational repertoire, performs useful functions in everyday life and is an everyday part of conversation for many people. “Despite this, it is relatively under-researched precisely because it is considered to be taboo. “Swearing performs many social functions including conveying abuse and humour, expressing emotion, creating social bonds, and constructing identity. “The strong social conditioning around swear words makes them more psychologically arousing and more memorable than other words, and something different happens in the brain when saying them compared to euphemistic equivalents, such as saying "f***" compared to ‘the f-word’.” You can read the full study, Text & Talk: An Interdisciplinary Journal of Language, Discourse & Communication Studies, HERE If you want to explore how the written and spoken word works in society, Aston University's innovative English language and literature degrees are for you. We emphasise practical applications, linking your studies to the real world through professionally relevant modules in areas such as Language and Literature in Education, The Language of the Law, Psychology of Language and Communication or Language at Work.
There’s billions of dollars flowing into Georgia – and with that economic development, comes good paying jobs. It’s getting a lot of attention and that means news coverage on local, state and national levels. Recently, media have been looking for expert perspective and opinion on the economic boom – and to help with their questions, Georgia Southern University’s Michael Toma is the go-to expert for reporters looking to break down the investments, the opportunities and the jobs that are coming with them. The SK Battery America plant is, appropriately, located in the city of Commerce, Georgia. The $1.6 billion project – expected to employ 2,000 – was finalized in early January 2019, but without investment from the state and local government, it might not have been built in Georgia. "They were looking at several other states, especially in the southeastern U.S.," said John Scott, director of economic development for Jackson County. "When we were working with them the final two sites were between here and somewhere in Tennessee." … According to Michael Toma, Ph.D., Fuller E. Callaway Professor of Economics at Georgia Southern University, a new project creating 1,000 jobs can have a huge impact, while 500 jobs is a significant project for medium-sized cities. How good the jobs are is a matter of debate, although state and local officials emphasize that they look for jobs that pay well. July 27 – USA Today/Savannah Morning News If you’re a reporter looking to know more about why business is booming in Georgia – then let us help. Michael Toma, Ph.D., is Georgia Southern University's Fuller E. Callaway professor of economics and is available to speak with media about this topic – simply click on his icon to arrange an interview today.
Podcast: 3D printing’s vital solution to medical problem caused by COVID-19
"They were looking to solve a problem and I was able to use my additive manufacturing knowledge to help them out, and the result of that was that we developed a new technology and span a company out of it." Dr Mark Prince Senior Lecturer in Mechanical Engineering Aston University New device created in Aston University lecturer's home during coronavirus lockdown Aston Business School expert explains how 3D printers are already used to make hearing aids, dental crowns and hips ‘Imagination is the only limit’ for additive manufacturing’s future, according to Dr Ahmad Beltagui A senior lecturer at Aston University is helping ear, nose and throat (ENT) clinics around the world by using the hi-tech ingenuity of 3D printing. Dr Mark Prince used 3D printing to prototype and produce a valve for a mask so that ENT surgeons could continue to examine and treat patients without fear of spreading the virus. Dr Prince, a senior lecturer in mechanical engineering at Aston University, was talking about his experiences in the latest episode of the 'Aston means business' podcast, presented by journalist Steve Dyson. The podcast also features Dr Ahmad Beltagui from Aston Business School, who talks about the wider benefits, some downsides and future potential of 3D printing in successfully disrupting traditional manufacturing. Dr Prince said his interest in additive manufacturing, or 3D printing, peaked after meeting two consultant ENT surgeons in the West Midlands. He said: "They were looking to solve a problem and I was able to use my additive manufacturing knowledge to help them out, and the result of that was that we developed a new technology and span a company out of it. "The company is Endoscope-i Ltd, founded in 2012 and now with an annual turnover of £200,000. The idea was simple: can we get medical endoscopic images of the ears and throat using a smartphone and we came up with a technique to do that." He said that, traditionally, he would have used large, expensive equipment to prototype the systems and new products. However, that wasn't possible with most of the university closed down at the height of the pandemic last year. He, therefore, had to look at other technologies that were safe to use in the home without breaking lockdown restrictions. Dr Prince explained: "When we are looking at diseases or concerns of the throat and nose we often stick an endoscope up the nose and down the throat, but of course you can't do that through a mask. "One of the founding members, Mr Ajith George, suggested that we could put a valve in the mask that allowed an endoscope to pass through it and allow the procedure to go ahead without breaking containment." "Work on the device started in mid-March 2020 and was ready for free supply to the NHS in November. Dr Prince added: "What that has allowed the NHS to do is any ENT clinic was able to fit it to a mask, put the mask on the patient, and carry on with an endoscopy procedure without all of the concerns of the pandemic." Meanwhile, Dr Ahmad Beltagui, a lecturer in operations and information management at Aston Business School, said you could get 3D printers from as little as £200 all the way up to expensive versions working with "exotic materials" like titanium. He said there were four main benefits to manufacturers: "Compared to traditional manufacturing methods you can produce shapes that are harder to produce; you can produce things in very small volumes; you can innovate faster and produce lots of prototypes, and you can produce things nearer to where they are required so you don't have to produce in a factory in one place and transport somewhere else." Dr Beltagui said: "The COVID-19 pandemic saw 3D printers used in homes to produce equipment such as cheap face visors for their local hospitals. The great thing about 3D printing is anyone can produce anything they want. "That's also the biggest risk – there is no control over what people produce or how safely they produce it. "At the beginning of the pandemic, someone in Italy found that they could produce some spare parts to keep the ventilators in their local hospital going. But then a few days later the manufacturer of those ventilators was considering whether or not it should take legal action." However, he said the printing machines had gradually become more reliable and there was a better level of quality, while the cost was coming down. Dr Beltagui added: "As to the future, the only limit is your imagination."
Rishi Sunak kickstarts Help to Grow scheme at Aston Business School
"It was a pleasure to host the chancellor at Aston Business School today. As a small business leader you have to know about all the key business functions and how to optimise them to drive high performance in your business." Paula Whitehouse, Aston Business School Paula Whitehouse (L) & Rishi Sunak (R) The Chancellor of the Exchequer met with Aston University’s deputy vice-chancellor engagement and associate dean enterprise of the College of Business and Social Sciences to launch Help to Grow: Management The scheme will support senior managers of small and medium-sized businesses to boost performance, resilience, and long-term growth The 12-week programme is 90% funded by the Government and participants can complete it alongside full-time work. The Chancellor has called on the leaders of small and medium-sized businesses to sign up to a new programme designed to hone their expertise as he attended one of the first courses in the UK today (August 2). Rishi Sunak joined a class taking part in the government-funded Help to Grow: Management scheme at Aston Business School, Aston University, alongside small business owners, to see first-hand how it is giving them the tools they need to innovate, grow and help drive the recovery from the pandemic. The Chancellor delivered a talk to participants at Aston Business School on the critical role small businesses can play in boosting UK productivity. He then took part in a group activity and led a discussion about their own business models and opportunities for growth. The scheme, which was announced at the March Budget and opened for applications in May, will give 30,000 SMEs access to world-class business expertise on everything from financial management to marketing and is a pivotal part of the government’s Plan for Jobs. Rishi Sunak, the chancellor of the exchequer, said: “Small businesses are key to our innovation and economy and will therefore be an essential part to our recovery from the pandemic, which is why we are levelling up their skills through the Help to Grow schemes. “I want to bring some of the best bits of management training from around the world to help boost productivity here in the UK. “Help to Grow: Management will ensure our brilliant SMEs seize every opportunity to grow, fuelling our Plan for Jobs by boosting productivity in all corners of the UK.” Experts in small business and entrepreneurship from Aston University have played a significant role in developing the programme. Paula Whitehouse, curriculum director for Help to Grow: Management and associate dean enterprise of the College of Business and Social Sciences, said: "It was a pleasure to host the chancellor at Aston Business School today. As a small business leader you have to know about all the key business functions and how to optimise them to drive high performance in your business. “Help to Grow: Management will combine this essential business education with the creation of a like-minded business network and support for the practical application of the learning to ensure businesses get immediate results. “I am excited to be working with Small Business Charter business school colleagues all over the country to roll out the Help to Grow: Management curriculum and ultimately to be introducing many more business leaders from the West Midlands into Aston's vibrant entrepreneurial community." Mark Hart, professor of small business and entrepreneurship at Aston University and associate director of Aston Centre for Growth, said: “The launch of the Government’s Help to Grow: Management programme for SMEs is a welcome addition at a critical time to the range of support available to small business leaders across the UK. “Small firms will drive the recovery as they have always done in previous economic downturns and equipping their leaders with the leadership and management skills from the UK’s leading business schools will ensure that they will build even more resilient, innovative and sustainable businesses capable of responding to the emerging opportunities in their chosen markets. “This is a practical, intensive 12-week programme designed by some of our top academics to provide the skills required to improve the performance and productivity of small firms across all sectors of the economy”. Mark Hart (L) & Rishi Sunak (R) take part in a class at Aston Business School
Brexit: UK services are losing out to EU rivals – but Asia could be big winner
"Seven months after Britain’s exit from the EU, the chilly effects on UK trade are being felt. Total exports of UK goods and services were down by 13% (£36 billion) and imports down 22% (£66 billion) for January to May 2021 compared to the same period in 2019." Professor Jun Du, Aston Business School Singapore looks like one of the big winners from Brexit. joyfull In a separate new ONS report into UK services, exports and imports fell 12% and 24% in the first quarter of 2021 compared to the same period in 2019. To some extent this is due to the pandemic, but the decline with EU countries was more severe (exports down 15% and imports by 39%), which suggests Brexit was relevant too. The difference between services exports to EU and non-EU countries was particularly marked in sectors like construction (-43% vs +24%), maintenance and repair (-62% vs +11%), and manufacturing services (-40% vs -12%). It seems to confirm that the UK’s services offering has been made less competitive by the EU-UK Trade and Cooperation Agreement hardly covering such business. This has left EU members free to decide whether to allow different UK providers into their markets. But as we shall see, other services exporting countries outside the EU may also benefit as a result. In our recent paper, Ireland looked like the big winner. It has probably benefited from firms relocating and business being re-routed from the UK, not to mention low corporation tax and a young well-educated workforce. Between 2016 and 2019, Ireland’s services exports rose 24% (that’s €144 billion or £123 billion), driven by financial services, IT and transport. Speculation still abounds about which other EU cities will benefit in the medium term. Amsterdam surpassed London as Europe’s largest share-trading centre in January by absorbing much trade in euro-denominated assets, though London has been back on top recently. Other potential winners include Frankfurt (banking), Luxembourg (banking and asset management) and Paris (financial, professional and business services). Even a less serious contender like Berlin can attract tech talents thanks to its culture clusters and affordability. On the other hand, most financial traders have so far remained in London. The city is still strong in hosting stock market flotations and other forms of capital raising. And the flow of financial jobs out of London has been a fraction of what remainers predicted. A four-year regulatory transition period for areas like data protection and electronic trade will undoubtedly be helping. London vs EU rivals is only half the story. James Padolsey/Unsplash, CC BY-SA Yet all this misses a bigger picture, namely that Europe’s ability to provide services may have been weakened overall. Imagine a group of US investors wants to invest £1 billion in European shares and other financial assets. In the past it might have set up a fund in London, making use of the city’s network of lawyers, accountants, bankers and other finance professionals, while filtering some of the work to specialists in, say, Paris and Frankfurt for issues related to France and Germany. But now Brexit means the fund can’t invest in certain EU securities from London. The investors would have to set up a second fund in, say, Dublin to get exposure to all the EU assets they want. The additional expense and time involved makes them decide it will be more lucrative to set up an Asia-focused fund in Singapore instead. When you multiply this effect across every sector, it is potentially huge. Certainly some investors will decide to either switch attention from the UK to EU countries, or to live with the extra cost of doing business across both the UK and EU. But others are deciding that an opportunity somewhere else in the world now looks more attractive. The danger is that this adds up to a global shift in economic weight over time. In fact, we could be seeing signs of this already. Winners and losers In follow-on research that we have yet to publish, we have been analysing the services exports of the major service providers in Europe and globally, using trade data jointly collected by the World Trade Organization (WTO) and the Organisation for Economic Cooperation and Development (OECD). The data shows the UK was and is the biggest services exporter in Europe and second only to the US worldwide, but appears to have been losing ground since Brexit. Ireland and the Netherlands are the major growth stories in Europe, while China, India and Singapore are leading the way elsewhere. Services exports by country, 2019 vs 2015 Trends in services exports. Left: 2015 data in solid coloured bars; 2019 change in yellow markers. Right: Green bars represent accelerating service growth; red bars represent decelerating growth. BaTIS The UK’s services growth trend fell 11% in the 2016-2019 period compared to 2010-15. This backs up our recent published research finding that the UK’s global share of exported services fell from 8.9% in 2005 to 7% in 2019. Meanwhile, France, Spain, Italy and Belgium’s growth has also been declining, while Germany, the Netherlands, Switzerland, Luxembourg, Austria and also the US were static. Ireland was the fastest growing services exporter among all, but Singapore and India gained momentum too. Strikingly, we see increasing growth in Asia between 2016 and 2019 in sectors like travel, financial, IT and creative services. This includes extraordinary growth in Singapore in finance, business, insurance and pension provision, and also in China in numerous segments. It looks like nothing short of a boom. Shanghai has been on the up and up. Krzystsztof Kotkowicz, CC BY-SA This may partly reflect the industrial transformation taking place in the Asian developing world from manufacturing to services. It may also capture a long-term shift of services centres from the west to the east – a reshuffle on a truly global scale. But at the same time, it’s evidence that Brexit has weakened the UK as the European centre for services. Yes, business shifted to Ireland (and Luxembourg) to some extent, but that could be hiding a wider collective setback. The question for the years ahead, for the UK and its European services peers, is whether they can come up with arrangements that help maintain their collective strengths – and to what extent they can exploit opportunities elsewhere, particularly on developing countries, where US services providers have traditionally been far ahead. This article was co-written by Professor Jun Du and Dr Oleksandr Shepotylo.
