Supply chain issues could end up boosting local economy in 2022 says Suffolk Chamber

John Dugmore, chief executive of Suffolk Chamber of Commerce, is concerned about an unemployment 'cl

John Dugmore, chief executive of Suffolk Chamber of Commerce, has shared his predictions for 2022. Picture: DAVID GARRAD/SARAH LUCY BROWN - Credit: DAVID GARRAD/SARAH LUCY BROWN

Suffolk Chamber believes that 2022 could be the launch pad year that significantly accelerates the shift within the county’s business community towards an even more diverse, highly-skilled, and inclusive economic model.

To achieve this, however, chief executive John Dugmore believes there are a number of hurdles that need to be cleared.

Catalytic schemes

First on Mr Dugmore's list are a number of key catalytic schemes, which he thinks need to be confirmed and commenced. 

He said: "The chamber believes these include both Freeport East, which promises to be a sub-regional game-changer in terms of the logistics and transport sectors and Sizewell C, which offers real commercial opportunities for local businesses in virtually every sector trading in the county at present."

Sir Keir Starmer said a new Sizewell C should bring community benefits.

Sizewell C could bring benefits to the local economy - Credit: Sizewell C

Future skills

Mr Dugmore continued: "Secondly, it is vital that the business community has much more influence over the aggregate future skills they need to fulfil their growth plans. Suffolk Chamber has been working with a range of local partners both here and in Norfolk in readiness to seize the opportunities to do just that once the Government’s Local Skills Improvement Plans are rolled out. For us, the sooner, the better."

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Government Support

The third condition that Mr Dugmore believes needs to be met is that businesses across all sectors need more support from government.

This will help them to sustainably deepen their investment in new technologies, R&D, including net zero compliant measures, the deployment of automation and virtual reality, alongside improvements in interpretative and soft skills training on the ‘human-side’ of the equation.

John Dugmore, chief executive of Suffolk Chamber of Commerce

John Dugmore, chief executive of Suffolk Chamber of Commerce - Credit: Suffolk Chamber of Commerce

Inflation concerns 

Suffolk Chamber forecasts that whilst it is likely there will be "spasmodic" shortages of specific products during the next 12 months, these are likely to be fewer in number as time progresses since more Suffolk companies are looking to de-risk and shorten their supply chains.

"We also believe that political relationships between the West and China and Russia are likely to have an impact as to how some companies access international supply chains and markets," said the chief executive.

"Such shifts present real opportunities for more of the Suffolk pound to circulate within our local economy. ‘Growing our own’ albeit seeking to maximise global trade opportunities must be a priority.

"Our principal worry in 2022 is that inflation and inflationary expectations will become fully baked into the system, putting further pressure on businesses’ margins and their appetite for investment especially in R&D, service and product prices and overall living standards.

"Based on evidence from our members, by the third quarter of 2020, Suffolk Chamber found itself as something of an outlier regarding the re-emergence of inflation. But evidence since then has largely confirmed our concerns. We remain inflation hawks and are looking to the Government to appropriately tighten up on monetary policy as needed to avoid the negative impact of prolonged inflation rates well above the Bank of England’s upper limit of 2%."

Labour shortages

There may well be periodic labour shortages in some sectors, as it takes time to fully supply necessary labour and skills pipelines that have been impacted by workforce losses in recent years, including due to Covid-19 concerns.

The Suffolk Chamber has always backed a "pragmatic approach" to adapting their immigration policy to ensure critical labour shortages can be swiftly addressed over the short term, particularly in certain parts of the manufacturing and agricultural/horticultural sectors. Which they plan to continue doing in 2022.

Covid-19 

"Hopefully Covid-19 will become ‘normalised’ and reduced to being one of the many manageable variables which businesses can contingency plan against," said Mr Dugmore.

"During the first two years of the pandemic, Suffolk business owners, management teams and workforces have proven their resilience and ingenuity time and time again in adapting from everything from lockdowns to new remote ways of working.

"But it has come at a high cost, both for individuals and for our society as a whole. Therefore, Suffolk Chamber predicts that there will be a greater and sustained focus on improving mental and physical health and wellbeing in our workplaces.

"Both because this is the right thing to do in itself and because there is a clear link between health and wellbeing on the one hand and sustainable productivity on the other, Suffolk Chamber is further stepping up its work with health bodies and others in this arena in 2022."