Firms hold an overall positive outlook on the regional economy looking forward, despite major uncertainties at a national and global level, according to the latest results of the Sheffield City Region Quarterly Economic Survey.
The Q4 2016 results – based on over 300 responses from businesses across the region – give a snapshot of how the regional economy performed during the last three months. The figures will be used to better inform local, regional and national government and policy-makers on issues of concern and to help shape support structures available to the local business community.
Key highlights from the survey results for Q4 2016 include:
- Both the manufacturing and service sectors showed a positive balance in sales in the UK market over the last three months. The service sector in particular, showed a sharp increase and the position was healthier than during the same time the previous year.
- Inflationary pressures continued to build in the regional economy, as well as nationally, with both sectors showing a strong positive balance in expected price rises in the next quarter. Both sectors identified inflation as a more important factor to business than a quarter ago and more businesses are concerned about interest rates.
- Both sectors showed higher expectations for workforce growth in comparison to the previous year.
- Recruiting skilled workers remained the biggest problem for the manufacturing sector, while for the service sector, recruiting for professional and managerial roles was most problematic. This reflects long-term trends in the UK economy.
- Over the last three months, the proportion of exporters investing in plant and machinery has increased to over 28% from 17% in the previous quarter.
- When asked about the preferred choice for the proposed Trans-Pennine Tunnel investment project (given the options of: Road, rail, both, neither and not sure), the most popular choice for both service and manufacturing firms was to have both a road and rail tunnel (53% and 47% respectively), followed by the road-only tunnel option.
Following the analysis of the results, Prof. Andrew Simpson, Associate Dean External Business Advancement, Sheffield University Management School commented: “Overall, the City Region economy shows a positive position and an ability to cope with economic factors. However, long standing issues around skills shortages and potential new inflationary factors are being factored into business decision making.
“The survey shows a region coping well with the uncertainty caused by major geo-political events. There is however a strong desire in the City Region for reduced uncertainty around the Brexit process and for reduced volatility in exchange rates. ”
The results support the British Chambers of Commerce’s forecast for continuing growth, but at a slower pace.
The results were presented today (10 January), at the Sheffield City Region Quarterly Economic Survey Breakfast which also saw business leaders from across the Sheffield City Region meet to debate infrastructure challenges and improvements – in particular the proposed Trans-Pennine Tunnel investment – that will support businesses across the Sheffield City Region in the years to come.
Sheffield City Region businesses will be surveyed again during Q1 2017 from 20 February to 13 March at www.screconomy.org.uk
All survey respondents will be entered in a free prize draw to win free Flybe flights to a European destination, courtesy of Doncaster Sheffield Airport.
The survey – run by the Sheffield City Region Local Enterprise Partnership (LEP), four Chambers of Commerce and Sheffield University Management School, and sponsored by RBS South Yorkshire & North Derbyshire – 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.
For further information visit: www.screconomy.org.uk