Almost all the indicators are positive in the British Chambers of Commerce’s latest quarterly economic survey, published this week.
A healthy balance report growth in sales – including export sales – confidence is high, and the findings show that businesses continue to invest and recruit staff, despite Brexit uncertainty.
The findings are more positive than expected.
Manufacturers and service businesses share this positive outlook, although manufacturers are generally performing better and are more optimistic.
There are only two clouds on the horizon.
There is no sign of an easing of inflationary pressures, with many manufacturers and service firms expecting to raise prices.
And 71% of the service businesses that attempted to recruit struggled to find the right staff – in the North West, including Cumbria, the proportion was 77%.
Rob Johnston, Chief Executive of Cumbria Chamber of Commerce, said: “The findings are more positive than expected given that the Government’s Office for Budget Responsibility (OBR) is predicting growth of only 1.4% this year. Perhaps the economy is more resilient than the OBR thought.”
The British Chambers’ findings are supported by official figures, also published this week, which show that manufacturing expanded by 3.9% in the year to November, the biggest rise since 2011.
Rob added: “Labour and skills shortages are set to be the biggest potential drag anchor on business in 2018, since ultimately it is people that make businesses work.
“Businesses must do more – by training and investing wherever possible in people – but government must also give firms the confidence to put their livelihoods on the line and go for growth.
“The Chamber can help here. Our Profiting Through Skills campaign offers free training to SMEs that want to upskill their workers or recruit apprentices.
“I’d urge businesses to take advantage. Time is of the essence though – this programme will close in March.”
To learn more about the free training on offer, call Cumbria Business Growth Hub today on 0844 257 84 50.
A specialist adviser will carry out a review of your training needs and opportunities to identify where improved skills could help.
They pass the assessment to an experienced training provider, or providers, who contacts you to arrange training programmes funded through the scheme and elsewhere. Training is available for new and existing staff.
This support is available through the Employees Support in Skills project, launched last year. The project is funded by the European Social Fund via the Education & Skills Funding Agency and supported by Cumbria LEP.
Other partners in the project include Carlisle, Furness, Kendal and Lakes Colleges, the University of Cumbria, Newton Rigg, Gen2 and SP Training.
Rob added: “This must be the year employers act on skills, and the year government delivers clarity, leadership and investment in people and infrastructure. Kick-starting growth and boosting prosperity depends on this.”
The British Chambers’ Quarterly Economic Survey is the largest of its kind in the UK, based on responses from 7,083 businesses in the final quarter of 2017.
The Bank of England takes the results into account in its deliberations on interest rates.
Survey results are generally presented as balance figures – the percentage of firms that reported an increase minus the percentage that reported a fall. A positive figure indicates growth while a negative indicates contraction.
For example, if 50% of firms told us their sales grew, and 18% said they decreased, the balance for the quarter is +32%.
RESULTS AT A GLANCE
Domestic Sales: +23% for manufacturers, +20% for service firms.
Export Sales: +25% for manufacturers, +12% for service firms.
Employment Growth (those reporting an increase in their workforce): +22% for manufacturers, +14% for service firms.
Employment Expectations (those expecting to increase their workforce): +23% for manufacturers, +19% for service firms.
Investment: +19% for manufacturers, +15% for service firms.
Prices (those expecting to increase prices): +50% for manufacturers and +36% for service firms.
Confidence (those confident that turnover will increase in the next 12 months): +44% for manufacturers, +36% for services.
The Employee Support in Skills project is receiving up to £8.5m of funding from the European Social Fund (ESF) as part of the 2014-2020 European Structural and Investment Funds Growth Programme in England. The Department for Work and Pensions is the Managing Authority for the England ESF programme. Established by the European Union ESF funds help local areas stimulate their economic development by investing in projects which will support innovation, businesses, skills development, job creation, social inclusion and local community regenerations. For more information click here.
© Cumbria Chamber of Commerce