The 2012/07/05 at 08:00
Activity levels recorded prior to the economic recession have not yet been recovered. This, in essence, is the main lesson drawn from the latest quarterly barometer published by the BCC, the British Chambers of Commerce. The entity, surveying 7,805 companies, estimates that businesses are definitely on the path towards improvement. Nevertheless, the lack of economic growth at the start of the year prevents businesses from making outright recoveries. “Growth cannot wait,” insisted John Longworth, Director General of the BCC upon the publication of the survey on 2 July. “The government must take an imaginative and brave approach to stimulating the economy and help businesses thrive.” Indicators also blow hot and cold, judging from the weak level of domestic orders in the second quarter of this year. In particular in the manufacturing sector where fewer businesses (-3 %) have recorded an increase in orders. The BCC bases its findings on the difference between businesses recording increases and those recording drops to assess the economic outlook. Results are also mitigated on the employment front: the services sector, which recruited more in the last three months, is expected to continue hiring in the future. On the other hand, the manufacturing sector is set to recruit less in coming months. Meanwhile, the assessment on exports is somewhat encouraging in both sectors; in the second quarter, 31 % of businesses in the manufacturing sector declared themselves to have recorded an increase in exports – namely 7 % more compared with the previous quarter. In services, this percentage is 24 %, with an eight-point increase from one semester to the next. Globally, the level of business confidence in the face of the economic situation remains lower than before the 2007 crisis. While more businesses in the manufacturing sector believe that they will come out with higher turnovers and profits in coming months, forecasts in the services sector have not shifted over the quarter. Prospects of investments in tools or training are not homogenous either: fewer companies in the manufacturing sector than in the previous quarter wish to invest in machines (-6 %) while no change has been noted for service companies. Due to the decline in raw material prices, there are also fewer British companies from all sectors seeking to increase their prices. Meanwhile, inflation, which reached 2.8 % in Britain in May, remains a topic arousing fear for 37 % of all companies surveyed.