Trepidation for a tough winter to come has emerged in analysis of the latest figures collated by the Hull and Humber Chamber of Commerce.
Survey work for the third quarter of 2022 was conducted with interest rates at a 30-year high, inflation predicted to climb still further before it peaks, supply chain issues and a cost of living crisis hitting consumer confidence. It has all led to a drop in business confidence across all sectors, with concerns about rising interest rates and inflation again proving to be a major worry with still no end in sight to the economic turmoil.
Domestic sales were down 13 points to a balance figure of –8, while domestic orders dropped even further, down by 37 points to a balance figure of –40 in the sample.
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The export sector was also down this quarter with sales dropping a further 25 points into negative territory to –50, while orders fell a further 17 points to a low balance figure of -67.
External affairs director David Hooper said: “Business confidence has taken a nosedive in the last quarter, with rising interest rates, inflation and energy prices piling on the pressure.
“However, it should be noted that this survey was carried out before the Government’s mini-budget, but its effect is unlikely to fundamentally change business sentiment going into the autumn.
Most sectors have been under considerable pressure in the last three months, and the survey shows there is little optimism for any improvement in the coming months, with turnover and profit expectations both well down on the previous quarter.
“Hopefully the energy cap for businesses will help a bit, but inflation is still a major concern as firms attempt to plan for what still looks like a challenging future.”
One of the few bright spots to eme4rge was a slight rise in the employment figure, which was up 11 points on the previous quarter, reflecting the summer trading period, however expected employment for the next few months was down 13 points on the last quarter to a balance figure of 5.
More firms reported concerns around cashflow, with the balance figure dropping a further 14 points on last quarter to –23.
Turnover expectations also fell back noticeably, dropping 33 points and into negative territory with a balance figure of –31, indicating that businesses are expecting a continuing slowdown in trade. Similarly, profit expectation was also in the doldrums, with fewer firms expecting to see increases. The balance figure dropped 23 points to –44.
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