The Chamber works closely with businesses across all sizes and sectors to ensure that business views are represented to key local and national decision makers. To ensure every sector is represented the Chamber hosts two Area Councils, one in Worcestershire and one in Herefordshire. Each Area Council consists of 15 specialists, from different sectors, who meet six times a year to provide feedback from their respective professions. The feedback is then used to inform our economic reports and shape the policy activity we deliver to Member businesses.
Below is a summary of key sector updates from the latest Herefordshire Area Council meeting:
Summary
The discussion focussed on how businesses have recovered since Coronavirus restrictions have been slowly lifted, whether the outlook is looking positive and how businesses are preparing for EU Exit. The following points were common among many of the Area Council members:
- There was a level of cautious optimism that business is beginning to return to normal. However, businesses are facing extremely uncertain times and are finding it difficult to predict whether increased demand will continue.
- There was a general feeling that a no deal EU Exit is looking more likely. Businesses are starting to prepare although the preparations are not as advanced as they were the last time EU Exit was on the horizon.
- The Kickstart Scheme is an interesting scheme that could really benefit individuals and businesses. As new starters take six months to settle into a role the hope is that it will give people a good chance to show how they can add value to a business.
- The Job Retention Bonus Scheme will have no real impact on decision making although any funds received could be put towards positive schemes within the business.
Manufacturing
Manufacturers have fared differently depending on the sectors they supply. The UK construction industry caused a blip when lockdown began but demand has now returned and is causing some supply chain problems. Things are beginning to look more positive, but not being back to 100% capacity may cause some manufacturers problems when the Job Retention Scheme ends in October. The Purchasing Managers Index experienced its biggest fall in April but has been above 50 for the last two months marking an expansion of manufacturing again. There are some concerns around a new spike of Covid-19 cases. Under the Track and Trace system if one employee tests positive it could have a knock-on impact on the rest of the workforce. The feeling is that there will be a no deal EU Exit and preparations are being made. There are concerns about increased administrative burden relating to import/export documentation. Manufacturers are looking at how to improve their business with new products and investment in automation and digital.
Transport and Logistics
Broadly getting back to the old normal and overall volumes have been up. Certain sectors including entertainment and hospitality are still struggling and it’s very difficult to plan as demand may not be sustained at the same level. Problems experienced before the pandemic are returning e.g. a shortage of drivers and congestion on roads (although fuel costs have stayed low). Likely to be a long-lasting change to the amount of paperwork the industry use.
Recruitment
Last year there were lots of jobs but few candidates, now we have few jobs but lots of candidates. There are still jobs available in more specialised, qualified roles – IT and accountancy for example. There has been an increase in enquiries from people who’ve been made redundant – fixed term contracts and zero hours contracts have increased in Herefordshire and the wider area. The labour market is unsettled and uncertain with good candidates not keen on moving because job security is key. There has been an increase in people buying franchises and exploring self-employment including new consultancies and start-ups. All these people will need support so there are opportunities especially for training providers. January will be the key time to assess the state of the labour market.
Education
Some colleges are reporting numbers are up because young people are staying in education rather than finding jobs at 16, others have had a significant reduction partly because students have higher grades (due to the cancelled exams) and partly because people don’t want to travel far for college. Apprenticeship numbers have been ok but will wait and see what happens at the end of the furlough scheme. Apprentice assessors have fed back that in the motor vehicle industry some main dealerships have not taken on any new apprentices, but local garages have due to people not buying new cars. Adult learning provision is experiencing constraints with funding rules. Colleagues that work in the West Midlands, who have direct control over funding, have introduced more flexibility for employers to help train people but that is not an option outside the West Midlands. Government white paper due mid/late October on Further Education around governance, structure and accountability.
Science and Medical
The life science industry is helping support Covid-19 clinical trials. General market conditions are buoyant with good opportunities and demand. The industry continues to work differently with a proportion of home working and don’t foresee changes happening soon. Supply chain more manageable now but still some challenges. Recruitment positive with strong candidates at all levels, but when looking for specific, specialised roles they are harder to recruit for. As the industry largely recruits graduates the schemes announced by the Chancellor in the Summer Statement don’t really apply.