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QES Q1 2020: Economy was holding steady prior to virus pandemic

THE Humber’s economy in the first quarter of 2020 was generally holding steady in most sectors, but that was before the Coronavirus pandemic put the country into lockdown.

The survey was conducted between February 17 and March 9, 2020, and the research by the Hull & Humber Chamber of Commerce, revealed that Home Sales and Orders both improved slightly compared to the last quarter of 2019.

Home Sales were up five points to a balance figure of –13, while Home Orders also showed an improvement over the last quarter, rising to a balance figure of –23.

On the export front, Export Sales and Export Orders both slipped slightly, with Export Sales dropping 15 points, while the balance figure for Export Orders dropped 23 points.

There was brighter news on the employment front in Quarter 1, with around half our respondents telling us they were looking to recruit staff in the last three months.

Looking ahead to the next three months, 2% fewer firms were planning to recruit, with the balance figure dropping from seven points in Quarter 4 of last year to five points in this quarter.

Fewer businesses reported difficulty in recruiting this time around, with the survey results showing an increase in those looking for full-time permanent employees, while part-time work was also on the up, with fewer companies trying to fill temporary positions.

The most difficult roles to fill in the last quarter were for unskilled/semi-skilled workers, with fewer firms looking to recruit into skilled manual or management positions.

In the last three months, business experienced a drop in their cash flow with the balance figure down by 13 points.

Looking ahead to the next three months, at the time of the survey businesses expected to see a drop in drop in their turnover, with the balance figure dropping 30 points to –7. Similarly, Profit Expectations also tumbled, with the balance figure dropping 21 points.

Only 28 per cent of firms said they were working at full capacity, down 2 per cent on the previous survey.

A substantial 23 percent of firms thought they would see their prices increase this quarter, with the main pressures on prices being overheads, finance and raw materials, while pay settlements were less of a concern.

External concerns this time around focused on issues such as tax, competition and interest rates, while exchange rates and business rates were considered to be less of an issue by our respondents.

Click here to download the full report.

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