Strong UK sales and easing cash flows enabled local businesses to record their strongest performance in two-and-a-half years in the second quarter of the year, according to the results of the region’s biggest regular independent business survey.
Derbyshire and Nottinghamshire Chamber of Commerce’s (DNCC) latest quarterly economic survey found that businesses are also reporting increasing confidence as they look ahead to the rest of the year, whilst their short-term order books – particularly from the domestic markets – are also filling up.
DNCC uses the survey to track business performance across a range of economic indicators to produce a quarterly “State of the Economy Index”*.
In the first quarter of the year, the index dipped by 53 points, but it bounced back in the second quarter, from 141 points to 215 points, and currently stands at its highest level since Q1 2008 (291 points).
In the latest survey, a net 11 per cent of Derbyshire and Nottinghamshire businesses reported an increase in UK sales, with a net five per cent also reporting rising export sales.
There was, however, a net fall in the number of firms recruiting in the second three months of the year.
But a net 18 per cent of local firms reported that their cash flows had eased during the past three months.
Looking ahead to Q3, business confidence in turnover increased slightly, but there was a marked upturn in confidence in profitability, with a net nine per cent of local firms expecting their profits to increase over the summer months.
Firms have also revised upwards their plans to invest in both plant/machinery and staff training.
DNCC Chief Executive George Cowcher said: “These results are positive and tally not only with the improving national picture but also with what businesses are telling the Chamber anecdotally about an increase in sales and short-term orders, which is good to see.
“What is most pleasing, however, is the fact that business confidence is starting to return, because when businesses are confident they can plan to expand, invest and recruit.
“With the fallout from cutbacks in public expenditure set to continue in the short-to-medium term, businesses are going to be under increasing pressure to create the jobs needed to absorb those lost in the public sector.
“So, signs the economy is edging its way further towards a full recovery are encouraging, but the only way to harness this progress is by creating a truly enterprise-friendly business climate here in the UK.
“That will require swift implementation of all of the pro-growth measures identified in both the Budget and Spending Review, along with more support for exporters seeking to enter new markets and far more action on finance for growing companies.
“Our businesses are well-placed to help drive the recovery and Government must do all it can to unleash the transformative power of enterprise.”
