Contributed by Suffolk Chamber of Commerce
4/01/2019 - Suffolk Chamber of Commerce
The latest figures from Suffolk Chamber of Commerce’s Quarterly Economic Survey (QES) for the final three months of 2018 shows a mixed picture as to how the county’s businesses are faring. In general terms, however, business activity and sentiment has continued to decline from earlier peaks, although the county is broadly in line in these regards compared with other parts of the eastern region in most cases.
These results are based on responses from 140 Suffolk-based organisations, with 33 from the manufacturing sector and 107 involved in services.
Overall, Suffolk businesses continue to report largely favourable performances, with positive responses outweighing negatives ones in most cases.
The significant exception to this is in future profitability, with the balances reported (manufacturers at 0% and service companies at -2%) at their lowest levels since the second quarter of 2017.
Overall, Suffolk manufacturing firms continue to report more bullish data than their service equivalents and account for the two main improvements on the third quarter 2018, with export sales up from +15% to +41% and export orders at +32%, up from +11%.
Manufacturing sector employment growth return to Q2 levels, with a 31 percentage points fall in the balance taking it back to +12%. In the service sector, the local balance fell by six percentage points and so is also at +12%.
The percentage of businesses attempting to recruit staff fell for the second quarter in the row for both sectors. The numbers of companies reported a continuing difficulty in finding the right staff fell slightly, but the figures remain historically high (+70% for manufacturers and +72% for service companies).
There were slight declines reported in cashflow levels, investment in both equipment and training, future turnover projections and the numbers of firms operating at full capacity, although most of these indices remained in positive territory.
A majority of respondents indicated they were under pressure to raise prices, especially in the manufacturing sector where 55% said they intended to raise prices, compared with just 3% who signalled the opposite.
These figures are broadly in line with the east of England as a whole, although the Suffolk results appear more bullish in terms of both domestic and overseas sales and orders.
When asked about their main external areas of concern, Suffolk’s businesses reported a major spike in worries about competition (up from 38% to 57%), with corporate taxation rates and inflation in second and third place respectively.
The key headlines from the survey are:
Paul Simon, Suffolk Chamber’s head of communications and campaigns, said “the overall gentle decline in current and planned business activity and sentiment in Suffolk continues and looks set to stretch into 2019.
“Whilst a soft-landing is certainly better than a crash, Suffolk Chamber is concerned that the direction of travel shows no immediate sign of abating. Indeed, the negative projections for profitability could be an early warning of a wider squeeze on business performance more generally.
“The ongoing reduction in hiring and the growth in worries about the impact of external factors, especially as the countdown to Brexit commences need to be taken seriously by policy makers. The political horseplay needs to stop.
“Once again, these results will strengthen our resolve to work through the British Chambers of Commerce to fix the business fundamentals.”
Suffolk Chamber is grateful to Suffolk Knowledge, part of Suffolk County Council, for providing the analysis of the QES.
All articles on this news site are submitted by registered contributors of SuffolkWire. Find out how to subscribe and submit your stories here »