• North West businesses have boosted their cyber security skills in the last year, with more than eight in 10 (81 per cent) either having relevant expertise or planning to develop it

• But more than half (51 per cent) of local businesses still lack the full set of Essential Digital Skills*

• Lack of appetite to grow tech ability could be costing UK businesses £260,000 every year

North West businesses have stepped up their protection against cyber threats in 2019, but more than half of all firms in the region still lack the full set of essential digital skills, according to Lloyds Bank’s latest Business Digital Index (BDI).

The annual report, the largest of its kind into digital skills, polled 1,500 small businesses across the UK, with more than 100 from the North West. The report combines survey data with businesses' transactional data to understand their digital behaviours and intentions.

The security index for the region, which outlines whether firms are protecting themselves against hackers and fraudsters, shot up by 13 points on last year to 50. An index reading of zero indicates a lack of online cybersecurity capabilities while a reading of 100 shows robust defensive measures are in place.

The region’s businesses also have a higher-than-average interest in security. Four in five (81 per cent) have already invested in their cyber security skills, or are planning to in future, compared with 78 per cent nationally.

But despite these advances in cyber security, a lack of Essential Digital Skills could be hampering opportunities to boost sales or productivity. More than half (51 per cent) of North West firms lack the full range of Essential Digital Skills, compared with the national average of 44 per cent.

North West businesses had the highest appetite to build their digital strategy and leadership skills of any region outside London, with more than half (55 per cent) either having done so already or with plans to do so in future. This compared with 44 per cent nationally.

The region also outperformed the UK average for having skills in social media and marketing (57 per cent, two points above UK average) and customer data analytics (42 per cent, one point above UK average), and was just below average on search engine optimisation (SEO) (49 per cent, two points below UK average).

Elyn Corfield, Lloyds Banking Group’s Ambassador for the North West, said:

“Cyber-attacks have become ever more prevalent and the destructive damage they cause can have long lasting effects. So, it’s fantastic to see North West firms increasing their cyber security skills to help combat this.

“However, with more than half of all businesses in the region lacking the full range of essential digital skills, many are still missing out on a huge opportunity.

“Our research found that an average small business in the UK with strong digital skills and behaviours earned around £260,000 more a year than one without. This is money that could be spent on hiring more staff, training employees and growing the business.

“An important part of the Northern Powerhouse is the Digital Powerhouse, and along with the arrival of 5G this looks set to accelerate the demand for digital skills in the region. Capabilities like SEO, social media marketing and data analytics will become a critical factor for businesses to succeed in the future.”

Nationally, a third (33 per cent) of firms said they had increased turnover and efficiency as a result of becoming more tech-savvy.

The report also found a national trend that small businesses that are less than three years old had better digital skills, with more than two thirds (69 per cent) of this group having all six Essential Digital Skills. UK businesses without these were also almost two and a half times more likely to be closing down in the next two years compared with those more skilled.

To help North West businesses boost their digital skills, Lloyds Bank has run digital skills sessions and courses across the region, including at its Manchester digital skills academy.

For more information about the BDI, visit: lloydsbank.com/businessdigitalindex