Posted by

Paul Faulkner, Chief Executive of the Greater Birmingham Chambers of Commerce

16 Jul 2015

The Greater Birmingham Quarterly Economic Survey (QES) for Q2 revealed mixed fortunes for the manufacturing and service sector.  Our manufacturers reported both improved UK sales and exports in Q2, contrasting to the national trend, which declined for manufacturers this quarter.  Our services firms however experienced both decreased UK sales and exports, in line with the national trend.

Notably, 70% of firms in Q2 reported having had recruitment difficulties. For manufacturers, skilled manual and technical workers were a challenge to recruit, while for service firms, suitable managerial and professional staff proved difficult to find.

In view of capex investment, fewer firms increased their investment intentions in Q2 compared to Q1. However, this was the result of more firms maintaing current levels of investment rather than decreasing it. For business confidence, overall sentiment is higher with more firms believing that turnover will increase in the next 12 months than in Q1. 

The result of the recent General Election, though perhaps unexpected, has supported certainty in the business environment.  The summer budget was also an important time for businesses and we welcomed the additional funding for the regional transport project “Midlands Connect”. One of the Chamber's key asks is to boost investment to infrastructure in the region. We are part of the ‘Midlands Engine’, and with the strongest economy in the country outside of the South East, we need to ensure we have the infrastructure to support it.

2015 continues to generate much opportunity for the Birmingham area.  The process towards creating a Combined Authority has made clear progress in the past few months, and we expect to see that continuing at pace in the coming period with real, definitive and hopefully positive outcomes.  The new government has also expressed its commitment to HS2, with Royal Ascent expected next year.  There is additionally an excited buzz around the opening of Grand Central in the centre of Birmingham, which is set to open in September - many of the shops, restaurants and cafes will be new to the city.

Looking ahead, it is crucial that these projects continue to make headway, and that businesses take advantage of the opportunities they provide, if Birmingham is to strengthen its economic growth.