Business confidence is low says Chambers Quarterly Economic Survey

Lincolnshire Chamber of Commerce’s Quarterly Economic Survey Q4 2022 – part of the UK’s largest independent business survey and a leading indicator of UK GDP growth – paints an overall gloomy picture following a surprisingly positive set of results in Q3 of 2022.

Running from 7th to 28th November, the survey opened two weeks after Rishi Sunak was appointed leader of the Conservative Party and Prime Minister.

The survey has shown that no businesses have indicated they will be able to reduce their prices over the next three months, with a balance of +78 expecting their prices to continue to rise and profitability likely to take a hit.

UK market figures have entered negative territory, with sales showing an overall balance of -3, down from +29 in September, likely to be an indicator of declining consumer confidence to be seen in business-to-business activity, whilst orders have also worsened to -6 from +20.

Overseas sales and orders worsen after seeing the worst results on record in Q2, with sales moving from 0 to -13 and orders move from -31 to -13.

Future recruitment pressures continue, however balance of respondents expecting to increase their workforce over the next three months has increased from +9 to +14.

Utility costs and inflation is the largest external pressure on businesses currently, impacting 83% and 72% of respondents respectively.

However, it is clear that businesses are feeling pressure from all angles, with fuel prices (67%), Interest rates (53%), Taxation (42%) and access to raw materials (44%) being more of a concern to businesses than they were 3 months ago.

Simon Beardsley, Chief Executive at Lincolnshire Chamber of Commerce said: “There is no denying that these results really portray a hostile environment for our local businesses, whilst reiterating the need to create a stable environment for businesses to invest, with energy, improvements to infrastructure, access to skills, and removal of trade barriers, particularly with the EU, all top priorities for businesses across Lincolnshire and beyond.

“Despite the gloomy picture, I am, however confident that Lincolnshire is resilient in its business base and now, more than ever, we need to create the right conditions for businesses to invest and grow, calling on the support of the Government who should put business support for SME’s at the heart of its agenda and getting businesses to build back better.”

Cllr Colin Davie, Executive Councillor for Economic Development, Environment and Planning, said: “Trading conditions internationally remain challenging and it’s no surprise that this translates to local difficulties and a less optimistic outlook.

“As the government recognised this week, change requires hard work and will take time. I’ve seen first-hand how ambitious Lincolnshire businesses are and how they strive to develop and grow even when times are tough, so we will continue to offer them the support to do this.”

View the full results via the QES Q4 Report here.