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.
If you want to find out more about your sector representative or get in touch to ensure your views are shared at the next meeting, click here.
Below is a summary of key sector updates from the latest Worcestershire Area Council meeting.
EU Exit is changing the number of EU students who are coming to the UK from next September. The UK are no longer part of the Erasmus scheme, a replacement is being considered but it will not be an equal replacement with equal funding. Due to Covid-19, the higher education sector has moved to remote learning. This will be at least until mid-February but may continue for the whole semester. Students are asking for refunds on accommodation which universities have agreed to. They are also lobbying for fees to be lower which is more difficult because universities have the same costs when teaching remotely and are not gaining funds from shops and catering. Research funding has stopped for a lot of things and access to European grants has ended.
Generally, the third lockdown is not impacting the manufacturing sector as much as the first lockdown in March although it does depend on the sector you are in. Food and pharmaceuticals continue to do well but automotive and aerospace are down. EU Exit has affected imports and exports as deliveries are taking longer. Even if companies have the correct paperwork they are stuck in the same queue as those that don’t. Some businesses may have avoided using the borders in early January by receiving goods before Christmas but that won’t continue for long so as volume increases it will be interesting to see what happens with trade. There is a concern from the industry that raw materials costs will continue to rise.
The housing market before Christmas had seen a period of high demand that started in late summer but has now cooled off after Christmas as it normally does. There is still significant demand for housing stock in Worcestershire from people outside the region but less houses are coming to the market. House builders remain positive despite the current situation; they are looking for more land and want to continue building. Projects that may have been paused during the first lockdown have continued this time as Covid-secure measures are in place. The sense is that as we come out of the pandemic construction will be a key area of the economy that will be supported. In the commercial area, industrial and warehousing domination looks set to continue. Supply remains constrained for warehousing in the area with few confirmed new builds and that looks set to continue. Offices have been slow unsurprisingly; some are speculating that people won’t want to return whereas others are now looking to return as soon as they can when safe – it will be interesting to see how this develops.
The market naturally slowed down on the permanent side during November and December because of the second lockdown and Christmas. Since the New Year there has been a big uptick in demand. It has been particularly encouraging to see demand for commercial and office roles (e.g. marketing) return because businesses hold off on these roles during a downturn before committing to recruitment. The temporary market is very busy which is good because it proves that there’s high demand but may also mean businesses don’t want to commit to permanent recruitment. Candidate availability is very tight and there’s a mismatch between those being made redundant in retail and hospitality and the skills that are needed in IT, engineering and more skilled office work e.g. HR/finance/marketing. The impact of EU Exit hasn’t been felt yet but it’s likely we will see more impact in the coming months and years.
There has been a lot of uncertainty in the retail sector due to Covid-19 and EU Exit. Bricks and mortar stores have missed out on the run up to Christmas, and now January sales, with national lockdowns being imposed. Online retail has really benefited, for example, Primark have not done well whereas ASOS, an online clothes retailer, has. There has been a big increase in dark stores (which don’t have premises but supply to the marketplace) and they will continue to grow. This can be good for certain areas due to the increased variety of goods and services available. Exporting is difficult due to the end of the transition period. Some couriers are stopping road freight on and off and costs have increased due to paperwork. Deliveries are taking a long time to arrive and shipping costs for containers have dramatically increased which may lead to price rises. The retail sector will improve during the year, but it is still a challenging time for some.