North West companies look beyond recession

CONFIDENCE among business professionals in the region has continued to improve during the last three months, according to a survey from the Institute of Chartered Accountants.

Companies are starting to look to the future, with key financial indicators such as planned investment and recruitment outperforming any other part of the UK, the latest ICAEW UK Business Confidence Monitor shows.

In the North West the BCM Confidence Index improved to +21.9 from +7.1 in the third quarter of 2009.

In common with most other regions, the North West also recorded strong improvement in the main indicators of business health, with turnover expected to rise by 4.2%, sales volumes expected to rise by 4.1% and profits expected to rise by 3.9% over the next 12 months.

North West firms also expect employee numbers to grow by 1.7% over the coming year, while capital investments are expected to grow by 2.5% – the strongest outlook for any UK region.

Alan Hyams, chair of the ICAEW North West Regional Strategy Board, said: “The North West economy is undoubtedly in better shape than this time last year and the improvement in confidence shows the relief businesses feel to have kept their heads above water. Although we are still on track for a return to economic growth, buoyed by investment in the region’s key sectors, the recovery is very fragile and will take time.

“Tightening of fiscal policy, the return to the 17.5% VAT rate, continued difficulties accessing finance and a budget Christmas by consumers are all potential threats to this recovery. Policy makers therefore need to be careful that the measures they announce support the recovery rather than unintentionally threaten it.”