Regional business survey shows a somewhat subdued picture over the last three months but business confidence remains solid.
The latest results of the Quarterly Economic Survey for the Sheffield City Region suggest that despite a somewhat subdued picture compared to the previous quarter and longer-term trends, business confidence remains solid. During Q4 2017, services and manufacturing sector firms across the city region reported positive balances on sales and orders but at levels somewhat down on the previous quarter.
“Results from the survey show that whilst exporters and domestic focused firms in the city region face challenges, they remain optimistic that they can meet these challenges and grasp new opportunities in the New Year. To meet these challenges and take advantage of emerging opportunities they are looking for support to enter new markets and to develop the skills of their employees” says Dr David Littlewood of Sheffield University Management School.
Results show that on balance both manufacturing and services sector firms expect the prices of their products and services to rise over the next quarter, with this driven particularly by raw material costs in the case of manufacturers and other overheads for service sector firms. Nevertheless, firms expect an increase in turnover and profitability over the next 12 months. Business confidence indicators are also slightly higher than at this time last year. Focusing on exporters more specifically, improving conditions are identified in major overseas markets.
Issues of most concern to firms in the city region relate to costs, competition, and challenges of recruitment/ staffing. Interestingly, whilst a majority of firms express some concern about Brexit, with 21% of manufacturing firms and 29% of services firms identifying that they are ‘very concerned’ about Brexit, a higher 50% of manufacturing firms and 31% of services firms state that they are only ‘slightly concerned’.
In this quarter, on balance firms increased their workforces. There is also, on balance, an expectation that firms in both sectors will increase their workforces in the coming quarter. Nevertheless, firms in the city region continue to face recruitment challenges, especially in recruiting for skilled manual/technical roles in manufacturing firms, and professional/managerial roles in service firms.
The results of the Quarterly Economic Survey – run by the Sheffield City Region’s four Chambers with the support of the Local Enterprise Partnership, Growth Hub and Sheffield University Management School and sponsored by The Source – are used to keep abreast of current business sentiment and influence decision makers accordingly. The survey is part of a national survey coordinated by the British Chambers of Commerce to act as an economic indicator for the Bank of England and to advise Whitehall.
The next survey for Q1 2018 is open to all Sheffield City Region firms to participate from 19 February to 12 March.
For further information visit: screconomy.org.uk