A delegation of leading East Midlands businesses, led by the Chamber of Commerce, took place this week with the region’s politicians in Westminster to discuss recent progress in the local economy and how MPs can support continued growth.
The meeting, facilitated by Nicky Morgan MP, Economic Secretary to the Treasury, came as the latest results from the region’s biggest regular business survey confirmed that the economic momentum built during 2013 continued into the first three months of this year.
Firms reported a fourth straight quarter of growth in quarter one 2014, thanks to strong sales and increased orders in both the UK and export markets.
A third of businesses increased their staffing levels in Q1 and a similar number said they expected to take on more staff in Q2. Those from the manufacturing and engineering sectors were found to be more likely to recruit, reflecting growing opportunities in these sectors.
Looking at the reasons behind the additional recruitment, 71% of respondents attributed this to the growth in business activity, with 31% also increasing their annual plans for investment in additional facilities and equipment.
Crucially, almost three-quarters of local businesses now expect their turnover to increase in the year ahead, with two-thirds predicting their profits will also rise in the coming 12 months.
Against a backdrop of continued debate on the cost of living, the survey also asked firms for their intentions relating to pay. Two-thirds of businesses said they anticipated awarding a general pay increase in the coming year, with 85% of those saying it would be at or above inflation.
The Chamber uses the results of the survey to track local business performance across a range of economic indicators, to produce a quarterly “State of the Economy Index”, which rose by 21 points to 389 in Q1 – its highest level since Chamber records began seven years ago.
Chamber Chief Executive George Cowcher said: “These results are really encouraging. They show that we’ve been able to build upon the strong latter half of 2013, which bodes well for the remainder of this year.
“As the second-largest Chamber in the country – and with the biggest proportion of respondents coming from the manufacturing and engineering sectors – this is also encouraging for the UK’s recovery as a whole.
“It has been recognised already by national decision-makers that if businesses in the East Midlands are thriving, then the country is also doing well.
“GDP for 2013 rose by 1.8%, with forecasts for 2014 ranging from 2.8% to 3.4%, depending on who you listen to. This is encouraging, as a steady pace of growth over the longer term is what’s needed to sustain the recovery.
“However, the broad-based recovery is still relatively nascent, requiring further encouragement and support so all our businesses – and our manufacturers and engineers in particular – can grow and flourish.”
The Quarterly Economic Survey is carried out by the Chamber of Commerce for Derbyshire, Nottinghamshire and Leicestershire and forms part of the biggest survey of its type in the UK.