Suffolk companies in 'yo-yo' mode as overseas sales and cash flows take hit
PUBLISHED: 11:50 03 January 2020
The government is being urged to give the economy a boost as Suffolk continued to see worrying declines in export sales and cashflow.
British Chambers of Commerce (BCC) Quarterly Economic Survey (QES) figures for the UK as a whole showed that the last quarter of 2019 ended in stagnation for the economy amid uncertainty and rising costs.
Suffolk's data revealed a mixed picture among the 134 firms - 41 in manufacturing and 93 in services - which took part.
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The county saw declines in 11 of the 30 main indices, and improvements in 17, suggesting it remained more robust than the East of England average, which saw 16 of the 30 criteria showing declines.
The BCC said its research suggested "protracted weakness" across the UK economy, with investment plans weak by historic standards, and cash flow only improving slightly from its lowest level in eight years.
Its survey of more than 6,400 businesses, covering the final quarter of 2019, highlighted a worsening picture in the services sector, which accounts for almost 80% of economic output.
Suffolk Chamber said further declines in export sales and cashflow were "worrying", with cashflow seen as a key indicator of the health of businesses.
Overall, Suffolk's service companies recorded a stronger last quarter in 2019 than previously, with marked improvements in confidence in improving profitability, turnover and growth in services employment.
But while Suffolk manufacturers recorded further improvements in domestic sales and orders from lows earlier in 2019, there was a marked decline in overseas sales and orders and cashflow.
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Suffolk Chamber's head of communications and campaigns Paul Simon described firms in "yo-yo mode" with no longer-term upwards momentum.
"In some quarters manufacturers seem to be doing well, only to fall back during the next three months. Equally, as with these results, having taken an earlier pounding, service companies then rally for a while - quite possibly before falling back again," he said.
In order to deliver their long-term growth plans, firms needed "appropriate assistance from government", he said, including securing a trade deal with the European Union.
Suffolk and Essex chambers are calling for infrastructure improvements - pinpointing the need for upgrades on the critical A14 and A12 routes - to help traffic flows.
Denise Rossiter, chief executive of Essex Chambers of Commerce, said with a majority government now in place, the chamber wanted focus not just on Brexit but other issues essential to ensure business confidence to plan for the future and invest.
"In Essex infrastructure as ever remains crucial and we want to not just get Brexit done but also get the much needed improvements to the A12 in Essex, the promised improvements to the A120 and the construction of a third Lower Thames Crossing delivered as a matter of urgency to help businesses achieve that desired growth."
In Suffolk, the quarterly figures showed the balance of manufacturing firms projecting an increase in cashflow fell from +19% to -3%, with those in services falling from -14% to -19%.
The balance of manufacturing firms in the county reporting an increase in overseas orders fell from 0% to -17%, while those in services were unchanged at -13%.
The balance of manufacturing firms reporting an increase in overseas sales fell from +7% to -7%, and fell from +5% to -15% for those in services.