Businesses in Derbyshire, Nottinghamshire and Leicestershire outperformed their national counterparts in the first three months of the year, according to the results of a new survey.
East Midlands Chamber (Derbyshire, Nottinghamshire, Leicestershire) has released the results of its latest Q1 Quarterly Economic Review 2015, which found that business growth remained robust in the early part of the year, giving an increasing number of firms optimism for the year ahead.
The findings were in sharp contrast to the national survey released by the British Chambers of Commerce earlier this month, which saw firms reporting weaker results in most areas – including domestic sales, exports and business investment.
The Chamber tracks business performance across a range of key economic indicators – including sales and orders, staffing levels, price expectations, investment intentions and business confidence – to produce a quarterly ‘State of the Economy Index’.
After falling in two consecutive quarters at the end of 2014, the index increased from a year-ending 377 to 386 in Q1, bolstered by firms’ strengthening confidence in their profits and turnover in 2015, which is resulting in rising staffing levels and investment plans.
In terms of activity, 51% of firms reported an increase in UK sales in Q1, which mirrored the previous quarter, and there was a slight fall in the number of firms reporting a decrease in domestic sales. However, this was offset by a fall (from 33% to 29%) in the number of firms which reported an increase in their export sales in Q1.
Firms’ confidence in both future turnover and profitability increased over the quarter, as 67% (up from 64% in Q4) said they expected their profitability to increase over the next 12 months, while 76% (up from 71%) expected an increase in turnover.
This strengthening confidence has led to business investment plans being revised upwards. Almost four-in-ten businesses said they planned to increase their investment in training and plant/machinery this year, while almost eight-in-ten businesses indicated they will award a general staff pay rise, at or above inflation, in 2015.
Chamber Chief Executive George Cowcher said: “Despite the build up to the General Election, it was encouraging to see such a resilient performance from East Midlands businesses in the first three months of the year, with many indicators of business success seeing improvements.
“Over the past year, the Chamber’s message to politicians and decision-makers has been that the East Midlands has moved from being a ‘bellwether’ of the UK economy to a national leader, so it is equally encouraging to see this message borne out in these findings, with the figures in this report exceeding their national equivalents.
“There are a number of factors contributing to this success, including the broad spread of business sectors present across this region and the drive and commitment that exists within East Midlands businesses and their employees.
“These characteristics will continue to stand the region in good stead post-election.
“Regardless of the political make-up of the next Government, if business had one overarching message to give, it would be to focus on delivering long-term policy and avoid the kind of political short-termism that acts only to complicate the planning and running of a successful business.”
