Lancashire’s attempts to pull itself out of an economic black-hole could be in for a tough 12 months, as the latest Quarterly Economic Survey (QES) results reveal.
Trading conditions in the past quarter dipped with many businesses experiencing a slump in domestic sales, while exporting also dropped, with inflation fears and the prices of raw materials causing most concern.
Problems with recruitment continue with manufacturing hit hardest and services following suit, being unable to find the right candidate for many professions.
An easing of inflation has done little to settle the nerves of business leaders, with many choosing to put off investment until the economic landscape steadies.
Only 40% of respondents to the last QES say they expect to make a profit, while a quarter say they expect to experience a drop in revenue. The results are bucking the national trend with some economists expecting a rough ride in the first few months of 2024.
The results of the QES were delivered at the Chamber’s quarterly Lancashire Economic Breakfast at Preston College in front of an audience of decision-makers from across the county.
Nationally, the British Chambers of Commerce shows a small rise in business confidence in the final quarter of last year, while most firms are still not increasing their investment.
Overall, the percentage of respondents reporting an increase to investment in plant/equipment has increased only slightly from 23% in Q3 to 24% in Q4. 58% of businesses said investment had remained the same, 19% reported a decrease.
There are large sectoral disparities in investment levels. 32% of hospitality sector firms say they have decreased investment, and only 19% have increased. Meanwhile, in the transport and logistics sector, 36% of respondents reported a rise in investment – only 18% a decrease.
Babs Murphy, Chief Executive of the North & Western Lancashire Chamber of Commerce, said: “The latest results make for grim reading after the optimism of the last quarter. With trade and exporting showing a slide, many business leaders are now wanting to hear some positive news coming from the government.
“The cost-of-living, the rising cost of raw materials and fears over the long-term future of the economy have led to a lack of investment in the county. This, coupled with external news across the globe, means we might be in for a rough start to the year.
“We have to stay positive though and keep moving forward the way we have following a tough few years. Only this way can we face the coming months with optimism and hopefully see more growth with the businesses we represent.”
