There’s no doubt about the fact that we’re living through uncertain times, politically, socially and, above all, economically.
In the case of the latter, this November’s budget only served to underline this fact with the announcement that the Office for Budget Responsibility had reduced its forecast for the growth of the country’s GDP for this year to 1.5%, a 33% drop from the 2% that it had been confidently predicted in March.
Then there is the looming shadow of Brexit and, while none of us can be sure exactly what this is going to mean until the detail has been fully thrashed out with Brussels, it’s fairly certain that it will also have a negative effect at least in the short term. Of course, that’s not to say that the claims of Brexiteers may well be vindicated eventually, but we will just have to wait and see.
However, it’s not all doom and gloom, for certain industries at least, and a number can afford to take a sanguine view of the prospects to 2018 and beyond. It’s perhaps significant that these are also the sectors that have been enjoying a purple patch over the last few years too. So, rather than their success coming from nowhere, they will be building on achievements made to date.
The glamorous era of Mad Men and Donald Draper may be long gone but advertising is one industry that continues to go from strength to strength. Although it had seen some uncertain times with the arrival of the digital revolution when many advertisers re-directed their big brand budgets into the shiny new world of digital media it has now embraced this, with great success.
So in 2018 the industry is looking forward to its 9th successive year of growth. According to a report by the media research company Group M the sector is set to grow by 4.8% with clients investing £19.8 billion. Drilling down deeper into the figures one sub-sector destined for spectacular growth is audio visual content creation, a £1.3 billion business which grew by 28% in 2016 and by 14% in the first half of 2017.
Like advertising, construction is a sector that has been affected by recessions in the past but it, too, is set to have put many of the bad times behind it and be looking forward to a good 2018.
While London is always at the heart of a construction boom it’s likely that the success will also be spread out over a wider part of the country and the reason for this is the Government’s much-publicised commitment to building 1 million new homes by 2020.
According to the Construction Products Association this will help to deliver a possible 23% growth in revenue in 2018 as well as a potential contribution of £12 billion to the UK economy, especially if the year’s target of 250,000 new homes is hit.
Another industry that the Government is very much behind is technology, and particularly digital technology. This has been particularly outlined in the Industry Strategy Green Paper published in November suggesting that even more focus should be placed on its development.
This, too, is a continuing success story that has seen £28 billion invested in the sector over the years since 2011, a figure that is three times bigger than Germany, Europe’s largest economy. Consequently the digital economy is growing approximately 32% faster than the economy as a whole and is thought to contribute £97 billion p.a, up 30% over the last five years.
It’s also not surprising that sectors that rely heavily on technology are also set to continue enjoying something of a boom too – with online gambling being an excellent case in point. In just two short decades it has come from nowhere to the largest single gambling sector in the UK according to Gambling Commission figures. As a result, it generated a Gross Gambling Yield of £4.5 billion yield between April 2015 and March 2016.
Of all of the games available at online casinos, it’s undoubtedly the slots that generate the highest revenues as they have a wide appeal and need virtually no skill to play.
With this in mind, the online casinos invest large sums in developing new versions, often themed towards everything from popular films to upcoming sporting event – so next year’s World Cup is certain to see a rash of new football-themed games coming online.
Online operators are also adept at enticing new players through incentives like welcome bonuses and free spins which work very effectively.
In terms of where online gambling and tech meet head on, it seems like virtual reality is going to be the next really big thing with various forms of VR gambling due to grow by 800% by 2021. This, of course, can only be good news for both sectors.
So the economic outlook is far rosier than many observers would have you believe, especially in the areas that we’ve discussed here and many others could also experience unexpected success too. For example, if next year’s summer is good then this will provide a massive boost for everyone from food retailers to garden furniture makers.
Alternatively, it could equally well be a great year for umbrella-makers but, as with all things to do with the economy, we’ll just have to wait and see.
- The economic future is uncertain but some sectors are expected to do well.
- Advertising is expected to see its 9th successive year of growth with digital AV creation doing particularly well.
- Construction will thrive due, in part, to the Government commitment to build 1 million houses by 2020.
- Tech will continue to do well and continue growing over 30% faster than the economy as a whole.
- Online gambling is the largest single sector in UK gambling now and its popularity is due to grow, especially in the playing of slots.
- So while the overall future may be uncertain, many sectors are due to thrive.