The rural economy has been thrown into crisis due to rising unemployment, shrinking profits and plummeting confidence, according to a new survey.

Data from the Rural Economy Index for the 2013 first quarter shows that agricultural and non-agricultural rural businesses are suffering.

The survey, led by the Country Land and Business Association (CLA) and Smiths Gore, revealed agricultural businesses are suffering because of bad weather, poor harvests and rising price of livestock feed.

Brian Finnerty, of National Farmers’ Union in East Anglia, said: “There’s no doubt farming is facing some short-term challenges at the moment, but our last confidence survey showed farmers were still relatively optimistic about the future of the industry over the longer-term.

“With the difficulties of the last year, particularly those caused by the weather, it’s easy to forget farming has been a real success story in recent years, increasing its contribution to the economy, creating jobs and seeing improvements in farm profitability.”

He said the Government could boost confidence by securing a deal on reform of the common agricultural policy that ensures fairness across Europe and does not impose extra burdens on English farmers.

Meanwhile non-agricultural businesses expect higher profits in the next year.

John Dugmore, chief executive of Suffolk Chamber, said the survey results are frustrating.

“Agriculture is the backbone of the economy in the east of England,” he added.

“Businesses we represent from this important sector are working harder than ever and if this survey is right, they need more support than ever.

“Investment in major infrastructure projects is key to address the problems. Better broadband for Suffolk is well under way now, but other projects such as the upgrading of the A14 through the county are vital.”

Nicola Currie, CLA east regional director, said the Government needs to improve broadband and encourage rural businesses to embrace of growth.