Confidence levels for firms across the West of England have fallen on the back of lower sales, fewer new jobs and worsening cashflow, according to the results of Business West’s latest survey.
The figures, released today, showed how susceptible the region is to shifts in the world economy, said James Durie, executive director of Bristol Chamber of Commerce and Initiative, part of Business West.
However, confidence levels remain high despite the fall and anecdotal evidence points to more positive market conditions, said Mr Durie, pictured.
The survey, for the third quarter, was completed by nearly 300 businesses in Bristol, Bath and surrounding areas, and revealed that almost all major indicators were down on the quarter and below the levels of this time last year.
Worryingly, sales decreased sharply with international sales down 12 points at 29% and domestic sales down eight percentage points to 42%.
Recruitment also fell – down one point to 23% – and expectations to take on staff over the next three months decreased three points to 32%
Cashflow decreased six points to 34% and overall business confidence dropped seven points to 64%.
Mr Durie said: “This quarter’s results for the West of England make for tougher reading than earlier in the year, with a decrease in all major indicators both on the quarter and against 2014 levels.
“Last quarter we saw some signs of a bounce back after a slow start to the year, but the last three months have seen a shift back in this. Whilst anecdotal evidence points to more positive conditions, our economy appears to have been hit by the seasonal effect of the summer period and growing global economic uncertainty.
“Look much further afield from the West of England and the UK and it’s been a turbulent couple of months for the global economy.
He said the impact of China’s ‘Black Monday’ in August, when hundreds of billions of pounds were wiped off worldwide financial markets – including £74bn off the FTSE – had been felt in the region.
“Although the strength of the global economy is being questioned, and is a significant concern, it isn’t all bad news,” he added.
“A couple of weeks ago we heard that employment rates, wealth and salaries mean Bristol is one of the five most affluent places to live in the UK. High-profile events are helping put us more and more on the world map. With Banksy’s Dismaland, the Arcadia Spectacular and Bristol’s year as European Green Capital, you can see why business confidence remains high at 64%.
“We have also heard that Bristol, Bath and our airport are indicating very strong visitor numbers. Recent signals that the new Hinkley C nuclear power station is getting ever closer to formally going ahead and the £6bn being spent on the Great Western line electrification will have big long-term impacts.”
However, the uncertain and every changing global outlook reminded the region that it must not and cannot rest on its laurels.
“In order to help sustain growth, business needs the right environment in which to operate. Both local and national governance have a crucial role to ensure we continue to invest in education and skills, transport, housing and digital infrastructure,” said Mr Durie.
“We cannot afford to be complacent and must fight very hard for continued public investment in this infrastructure which will stimulate more private investment now and into the future. We may be experiencing some hurt to our growth for now, but looking forward there are still reasons to be positive and optimistic.”
