Following a tough quarter one for firms in the Humber, the second quarter of 2021 has seen a marked turnaround in fortunes with all the indicators returning to positive territory.
Research by the Hull & Humber Chamber of Commerce clearly shows that business confidence is returning as the easing of the pandemic lockdown restrictions begin to take effect. Although the fieldwork for this survey was conducted before the lifting of restrictions was further delayed by the Government until July 19, Humber businesses are clearly “getting on with the job” of getting our economy moving again.
The Chamber’s External Affairs Manager, David Hooper, said: “The turnaround in business fortunes in the Humber in Quarter 2 has been quite pronounced, and while we welcome that good news and brighter outlook, it is clear there are underlying concerns about rising raw material costs and inflation.
“However, as we move towards the lifting of lockdown restrictions on July 19th, followed soon after by the end of the Furlough Scheme, we hope to see our retail and hospitality sectors in particular rebound strongly as workers return to the marketplace and fill roles we know some businesses are currently having difficulties recruiting for.
“While the Quarter 2 indicators are good, the Humber’s economy is still fragile in some areas, with underlying concerns and uncertainty, so a steady hand on the tiller is needed across the board, with the hope that the summer season sees us set fair for the rest of the year!”
“To help its members as much as possible, the Chamber has invested in its membership offer which now includes five new advice lines covering HR, H&S, Legal, Tax and VAT issues.
“These are employer focused services backed up by unlimited access to experienced advisors and access to a library of 800 documents and templates for things like employment issues, furlough, redundancy or H&S requirements around Covid-19, risk assessments, H&S policies etc. Click here for more information.
The Quarter 2 Survey revealed that both Home Sales and Home Orders saw a huge turnaround from where they were in the first quarter, with the Home Sales balance figure improving by 46 points, while the order books did even better, with its balance figure rising by an impressive 63 points.
It was a similar picture in the export sector, with Export Sales rising by 41 points and Export Orders rising by 38 points.
Employment figures in the last three months also improved with the balance figure up by 35 points. The outlook for the next three months is just as positive, with more firms saying they expect to increase their workforce in the next three months, the balance figure rising by 27 points to 35.
The number of firms recruiting staff also doubled, when compared to the previous quarter, with 63% of firms saying that they tried to recruit staff. There was an increase in full-time and part-time posts alike, with a strong increase in permanent jobs, along with a sizeable drop in the number of temporary jobs available.
Unskilled and semi-skilled jobs was where most vacancies were to be found, with fewer clerical jobs available in Quarter 2. Management roles were fairly static, while skilled manual vacancies saw a drop from their previous figure.
In the last three months, many firms reported better cashflow, with the balance figure rising from –15 in Quarter 1, to 32 points in Quarter 2, a swing of 47 points.
Investment in Plant and Machinery and Training also saw a considerable turnaround, with 34% more firms saying they had plans to invest, while training also rose by 30 points when compared to the previous quarter, putting the sector back into positive territory for the first time in more than a year.
Looking ahead to the next 12 months, there was a large increase in the number of firms who expect to see their turnover increase, with the balance figure rising by 30 points to a balance figure of 53.
Profit expectations also made good gains, with 24% more firms saying they expected to see higher profits in the next year, although rising prices was a concern for many.
The biggest external concerns this time around were Inflation, Business Rates and Competition, while rising Raw Material costs were also a worry.