North East Chamber of Commerce: Next government needs pro-business approach

A pro-business focus is required by the next UK Government if confidence is to remain high across the private sector, the North East Chamber of Commerce (NECC) has claimed.

The Chamber’s latest Quarterly Economic Survey has revealed many businesses are planning to cut back on investment.

With the General Election looming, businesses are winding down on investment in both plant and training, which matches anecdotal feedback that firms are waiting to see who will form the next Government before making significant decisions on investment.

NECC Policy and Research Manager, Mark Stephenson, said: “Whoever is in government after the next election must introduce pro-business policies to ensure that drops in confidence and investment do not persist for too long.

“It has been our businesses that have driven forward the recovery and without sustained growth then nothing else is possible. It is vital that this hard won recovery is not placed in jeopardy by uncertainty.”

Encouragingly, domestic market indicators across the service sector show a rise in sales and orders, while manufacturing remains healthy despite a slight decrease on last quarter.

NECC launched the first Quarterly Economic Survey of 2015 and while growth has slowed since record figures recorded in early-2014, the latest results demonstrate that last year’s optimism is turning into genuine economic growth.

Mark added: “Indicators show that across the service sector domestic sales and orders balances rose and that manufacturing balances remain robust even if they have dropped back compared to the end of last year.

“In other areas, we saw mixed results. Export indicators show manufacturers experiencing a fall but remained steady for service firms.

“What is reassuring is that confidence remains high in both manufacturing and service firms, with both expecting to see increases in turnover and profitability over the next 12 months.”

The latest QES also shows that firms are expecting to spend less on recruitment and training of workforces, but most respondents are more optimistic about future profitability and turnover.

There are also increases on cashflow and prices both over the last quarter and when compared to last year’s figures.

“Like last Quarter, there is much to remain optimistic about,” said Mark. “The most important thing for business now is that we secure a supportive Government that introduces policies that not only stimulate growth, but further empower firms to continue to the good work we have seen over the last two years.”