Positivity 'coursing through the veins ' of region 's businesses - Chamber report
Firms across Greater Birmingham have positivity 'coursing through their veins ' and are back on an upward trajectory as a result of lockdown restrictions continuing to ease, a new survey revealed today.
The Greater Birmingham Chambers of Commerce (GBCC) second quarterly business report of 2021, sponsored by Birmingham City University (BCU), has shown that many businesses across the region are now on the road to recovery after struggling to stay afloat amidst the uncertainty of the Covid pandemic.
GBCC chief executive Henrietta Brealey (pictured) attributed the report 's upward trends to the influence of the Government 's vaccine rollout, as well as the gradual easing of restrictions which have allowed businesses to resume trade.
She said: “Positive sentiment is coursing through the veins of many businesses in Greater Birmingham. The optimism is reflected in the results of our latest survey with domestic demand soaring to a level not seen since the onset of the pandemic, a steady climb in international sales and an upturn in recruitment levels.
“It was also pleasing to see that both turnover and profitability projections continued to rise this quarter. Business investment in training and capital investment also continued to tick upwards, with both returning to positive territory for the first time in over a year. ”
In terms of domestic demand, the balance score increased by 21 points this quarter to a figure of 68 - the highest score on record since Q4 2018. Hoping to maintain this upward trajectory, 49 per cent of businesses were confident that this increase would continue.
Scores for export demand emerged from negative territory for the first time since the beginning of 2020, with 32 per cent of firms across manufacturing and service sectors noting an increase in non-UK sales.
Recruitment figures showed that 22 per cent of businesses had reduced the size of their workforce this quarter. However, this was counterbalanced by the rise in businesses scaling up their headcount (32 per cent) and levelled the score to a figure of 55.
Despite the general sentiment of optimism, Ms Brealey noted the Prime Minister 's recent decision to delay lifting the last set of nationwide restrictions and also acknowledged that Birmingham 's designation as an area in need of enhanced support as the country bids to return to normality could have an impact on the rate of recovery going forwards.
In particular, the majority of firms under pressure to raise their prices with concerns in relation to inflationary pressures particularly prominent this quarter.
Nevertheless, cash flow has emerged also from a negative territory and 31 per cent of firms have noted an improvement in cash flow compared to their position three months ago.
Professor Julian Beer, deputy vice-chancellor at BCU, said: “Figures across the board have staged a dramatic recovery over the past six months and are now back to (or possibly very slightly above) “normal ” levels. The general implication is that the Greater Birmingham economy has more-or-less returned to pre-pandemic norms, although there are important caveats.
“There are certain sectors where a full recovery simply isn 't possible until they are permitted to operate at capacity.
“Further recovery in the third quarter can be anticipated given increasing consumer confidence and a further loosening of domestic restrictions. Major downside risks predominantly relate to policy - the withdrawal of fiscal and monetary stimuli needs to be handled with considerable care - and international shortages and price increases. ”
The GBCC are hosting a QBR briefing on Thursday, which offers a further, comprehensive overview of the region 's performance this quarter.
Speakers include Dr Justin Varney, director of Public Health at Birmingham City Council and Sam Taylor, creative director at Tinker Taylor.
To book your place, click here
(A balance score of over 50 indicates growth, as opposed to below which indicates loss)