St Helens Economic Survey shows post-Brexit dip in confidence but no sign of slowdown

18 Oct 2016

Business

The St Helens Quarterly Economic Survey for the third quarter of 2016 was the first opportunity to get an insight into how Brexit is affecting local business.

The latest survey results have highlighted a fall business confidence, as uncertainty rises following the EU referendum. Despite this, manufacturing respondents recorded improvements in seven of the eight key economic indicators, however the majority of service sector indicators remained flat.

The results reflected the national picture released by the British Chambers of Commerce, who bring together the national results on behalf of the Chamber network, which showed that manufacturers enjoyed improved domestic and export sales compared with the previous quarter, with some benefitting from sterling’s recent fall. Meanwhile, the number of service sector firms reporting improved domestic and export sales was at the lowest level seen since 2012.

On a positive note, both sectors reported increases in job creation in the last three months, with the pace of job creation slightly more prominent for manufacturing respondents. Both sectors anticipate a further increase in their workforce in quarter four.

According to the Office for National Statistics nationally capital investment fell in quarter three, however St Helens manufacturing investment intentions plans are at their highest levels for over a decade.

Kath Boullen, Chief Executive at St Helens Chamber, commented: “The post-referendum picture is still emerging and will continue to do so over coming months and years.  Information so far generally covers short-term indicators with other important information not yet available. However, the St Helens economy has shown no substantial signs of a major slowdown in the months following the decision to leave the European Union.

“The uncertainty surrounding the UK’s long-term political arrangements with the EU is expected to dampen growth prospects towards the end of 2016 and over 2017. The value of sterling, the shape of future trade relationships, the status of EU nationals in the UK workforce and other factors will all influence business confidence over the coming quarters.

“Although individual businesses will continue to report strong trading conditions, it is possible that a sharp slowdown in UK growth lies ahead. The British Chambers of Commerce latest Economic Forecast suggests that the UK is likely to avoid a recession, but with the health warning that businesses are still digesting the result of June’s EU referendum and the challenges and opportunities to come.

“The full picture of how Brexit will hit the economy will not become clear until Britain actually leaves the European Union. However, stability, clarity and action must continue to be the watchwords for government. Aside from a clear timetable for negotiations with the EU, ministers must act to support business investment and confidence.”

St Helens Chamber Members can be assured that the Chamber will be working very closely with the British Chambers of Commerce to articulate their concerns at the highest level of Government.  

Full Reports on the current quarter and previous five years surveys are available to view on the webpage.