Businesses across Herefordshire & Worcestershire have continued to grow despite increasing upfront costs and uncertainty around Brexit, according to the latest Quarterly Economic Survey (QES) results.
The results showed that 87% of businesses across the two counties reported increased or steady domestic sales, up from the previous quarter. Export activity remained strong across the region with 90% reporting increased or sustained activity. In addition to growth in sales at home and abroad, almost a third of businesses have increased investment in their premises and equipment, a great indicator of a thriving local economy.
However, despite this growth, 41% of companies reported pressure to raise prices, as they begin to feel the pinch from increasing costs such as the National Living Wage, the Apprenticeship Levy and the sharply rising costs of raw materials resulting from the fall in the value of Sterling since the EU Referendum last June.
The region is also experiencing a significant skills shortage, hindering growth. Half of businesses reported difficulty finding the right staff at the start of 2017, particularly for skilled manual/technical and professional roles. This has been a trend over the last few years and seriously needs to be addressed in advance of the Brexit deal, especially before any decisions are made around immigration.
Overall, the results paint a picture of growth and resilience of local businesses in the face of significant headwinds. Upfront costs and volatile market conditions continue to add to the uncertainty many businesses are feeling. Following the election announcement, it is vital that local needs are not pushed aside and that these rising costs are addressed in order to allow businesses in Herefordshire and Worcestershire to truly flourish in a post-Brexit Britain.
Sophia Haywood, Policy Manager, Herefordshire & Worcestershire Chamber of Commerce, said:
“Following the snap election announcement, it is vital that it doesn’t distract from fixing fundamentals for the business community. This will undoubtedly add an extra layer of uncertainty for local businesses, who will want to see all political parties have business needs and a healthy, growing economy at the heart of their campaigns. Businesses don’t want to see political games unfolding in Westminster; they want to see them knuckle down to the business at hand.”