Report shows confidence improving as 2020 ends

Business confidence improves but the Chambers of Commerce warn that the “crisis is not over” as its latest economic report shows sectoral imbalances.

The Chamber’s quarterly economic survey of businesses which was conducted just as the second national lockdown started in November 2020, shows that manufacturing rebounded following a very challenging year, with domestic and international sales up on the previous quarter for many.

However the report also suggests that these improvements might have been down to orders being brought forward or suppliers looking for more certainty by purchasing from UK companies ahead of the end of the EU transition period at the turn of the new year.

Across the service sector the significant restrictions brought about by the current health crisis have been especially damaging for the leisure, hospitality, accommodation and catering sectors. While, professional services, especially regulatory, compliance and essential business-to-business services, reported an improvement in domestic sales on the previous two quarters.

Speaking on the results, Nick Garthwaite, chair of West & North Yorkshire Chamber said, “The Covid crisis has tested our business community to the limit and sadly we have seen many jobs lost and industries hollowed out across our region. Our city centres have seen significant downturn in footfall and our High Streets are unlikely to return back to how we knew them before the crisis.

“Yet despite all of this I remain optimistic that our economy will recover and that there are some positive messages to take from the latest Chamber findings. Clearly we are not out of the woods yet, and the imposition of the latest lockdown is testament to this but the development and roll out of a vaccine will bring some comfort to many.”

Martin Hathaway, managing director of the Mid Yorkshire Chamber of Commerce highlighted that that the country has “not yet made it through this crisis” and that with the announcement of another national lockdown “further support is needed for businesses to survive” and emphasised that the country has “not yet made it through this crisis”.

On the topic of Brexit Hathaway said: “We welcome the deal made with the EU as businesses now have more clarity and can start adapting to the new trading arrangements. As we commence the new year with new relationships in place, we believe Brexit will be a fantastic opportunity for businesses to forge new connections and thrive when it comes to exporting and importing from overseas.”

Roger Marsh OBE DL, Chair, Leeds City Region Enterprise Partnership and Chair, NP11, said, “In the final quarter of 2020, there are signs of improvement in manufacturing where increasing sales have driven the sector back into growth territory for the first time since 2019. While economic activity still remains low, in both export and domestic activity, there are signs of recovery with both foreign and UK sales improving significantly from Q3.

“It is positive to see business confidence rise from the previous quarter alongside business investment which has returned to growth. Capital investment has grown in both the manufacturing and service sectors, however this positivity does contrast with the employment outlook with many businesses reporting a reduction in headcount in the last quarter.”

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