Findings from the first St Helens Economic Survey of 2018 showed a stronger start to the year for manufacturers, with 39% reporting to be operating at full capacity, compared to 15% at the end of 2017.
The service sector on the other hand is in the doldrums, reporting low advance orders at 2% a reduction from 5% in Q4 of 2017.
Over the last three months cash flow has tightened and the pressure has been on to raise prices in the service sector, with raw material prices and other overheads being the main factors.
On a more positive note, there has been an advance in orders for service sector firms that export.
Other key findings include:
- The positive trend in export sales and orders for manufacturing looks set to continue into 2018, with reported advance export orders showing an increase at 44%
- 61% of manufacturers attempted to recruit in Q1 2018, an increase on 40% in Q4 2017
- 35% of service firms attempted to recruit in Q1 2018, a decrease against 38% in Q4 2017
- Recruitment difficulties were reported by 53% of manufacturing firms and 43% of service firms with both sectors experiencing difficulty with recruiting a semi-skilled and skilled manual and technical staff.
- 43% of manufacturers are confident turnover will increase in the next 12 months, up from 23% in Q4 2017.
Tracy Mawson, Deputy Chief Executive at St Helens Chamber, commented: “There has been a small, but welcome, step forward in business confidence – but amid a troubling global economic and political context much more needs to be done to safeguard the future of the economy.
“Even with a standout performance from manufacturing exporters able to reap the benefits of lower sterling, the UK economy as a whole is treading water, rather than powering ahead.
“A strong focus on fixing the fundamentals of business – reducing the upfront costs, enabling businesses to secure the skilled workforce they need, and boosting our physical and digital infrastructure – will go some way to removing many of the barriers which are holding back business communities across the country.”
View the latest results of the Quarterly Economic Survey here.
