Confidence levels among businesses in the Black Country have seen a notable decline in the third quarter of the year, with taxation emerging as the primary concern for many, according to a recent economic survey conducted by the Black Country Chamber of Commerce.
The survey, the first to be released since Sir Keir Starmer’s Labour Party secured victory in the General Election in July, indicates that 60% of local firms expect an increase in turnover over the next year. While this figure remains higher than the national average, it has dropped from 71% in the second quarter. Additionally, 50% of respondents anticipate improvements in profitability, a decline from 62% reported three months earlier.
The findings from the Black Country Chamber of Commerce Quarterly Economic Survey (QES) for Q3, published today, provide valuable insights into the local business landscape amid rising speculation regarding the Government’s upcoming Budget, set for release on October 30.
Presented during the Chamber’s Quarterly Economic Survey Data Reveal event at Walsall’s Bescot Stadium, the survey highlighted that taxation is now the predominant issue facing firms across all sectors in the region, with 31% citing it as their primary worry.
Despite the downturn in confidence, businesses in the Black Country are still reporting a more positive outlook compared to the same period last year. In Q3 of the previous year, only 55% believed turnover would improve, while 45% anticipated an uptick in profitability.
Throughout 2024, the QES has consistently shown Black Country business confidence levels surpassing those in the broader UK, as recorded in the British Chambers of Commerce quarterly surveys.
During a briefing that accompanied the survey results, Chamber members engaged in networking activities, followed by a presentation from Gemma Edwards, the policy and impact officer for the Black Country Chamber of Commerce.
Edwards remarked, “The focus on taxation as a key concern suggests businesses are increasingly anxious about the forthcoming Budget and future economic policies. This anxiety has resulted in a decrease in investment plans among many firms. Nevertheless, it’s encouraging to note that local businesses are still exhibiting a greater level of confidence compared to last year, reflecting their resilience in the face of challenges.”
Key findings from the survey indicate that 31% of firms reported an increase in domestic sales, a decrease from 42% in the previous quarter. Meanwhile, 40% of businesses experienced no change in sales, and 18% reported a decline, up from 9% in Q2. Additionally, only 7% of firms saw a rise in overseas sales, down from 9%, while 12% reported a decrease.
The survey also revealed a decline in recruitment attempts, with 57% of firms attempting to hire in the past quarter, compared to 62% in Q2. Simultaneously, recruitment difficulties increased, with 62% of businesses facing challenges, up from 60% in the previous quarter.
Sarah Moorhouse, CEO of the Black Country Chamber of Commerce, emphasized the significance of the QES findings, stating, “This survey marks the first since the General Election and offers critical insights into business performance and concerns as we approach the Budget and strategize for 2025. The results are closely monitored by HM Treasury and the Bank of England’s Monetary Policy Committee, playing a vital role in shaping decisions that affect interest rates and business policies.”
The event also featured a presentation by Anthony Burns from Paycare, discussing how companies can leverage employee benefits to attract and retain talent. A panel discussion involving local business representatives highlighted effective strategies for enhancing staff benefits and improving recruitment and retention processes.
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