Economy: It’s been a mixed month for businesses in East Anglia, says Steve Elsom

Lloyds TSB Commercial area director Steve Elsom

Lloyds TSB Commercial area director Steve Elsom - Credit: Archant

BUSINESSES in East Anglia could be forgiven for feeling a little less than optimistic as we head into the second quarter of the year. Every day there seems to be a new set of economic data, scrutinised for signs of a “triple-dip recession”.

Yet last week’s manufacturing figures from the Office for National Statistics (ONS) have given some hope to economic commentators. Factory output rallied in February, though there are still concerns that uncertainty in the eurozone continues to make it harder for UK firms to export.

But what about businesses in East Anglia? The latest figures from the Lloyds TSB Commercial Banking Purchasing Managers Index (PMI) for March, published this week, show that a difficult economy continues to put pressure on firms. The good news is that the East of England survey demonstrated that businesses in the region are still growing. Less positive is that this rate of growth has slowed since the beginning of the year. Almost a quarter (22%) of firms said they are being affected by higher energy prices and a weak pound, with some companies having to raise prices to offset this.

The latest data, collected from a survey of manufacturing and service sector businesses, showed that East of England companies hired additional staff during March, but again this rate of job creation has slowed. Those that had hired did so because they had new orders. However the figures are nuanced since the number of jobs being created is not as high as in earlier months this year. That’s not particularly surprising since, if firms are facing increased material costs and a difficult exporting environment, they are less likely to make new hires.

So our survey, like other sets of economic data from the ONS or Bank of England, gives a mixed picture. Some believe that poor weather conditions across the UK are to blame for slow growth, in East Anglia that may well have affected our local retailers, and kept away tourists.

But instead of getting bogged down in the “whys”, I want to focus on the positives, after all businesses in East Agloa are still growing despite a difficult economy. We have some fantastic companies and a wealth of entrepreneurial talent across places like Cambridge, Norwich, Ipswich, Bury St Edmunds, and Kings Lynn.

While it is understandable that many firms remain wary, we need to encourage confidence amongst businesses and help those looking to expand to take the plunge. For businesses to be able to grow, they need to be in the position to take advantage of any opportunities that come their way. That means having the right number of staff to take on a new project, the capital to buy a new piece of equipment, or the right exporting guidance if they receive their first order from overseas.

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If we can harness the spirit of those firms that are branching out, from the new pharmacy in Ipswich that started trading this year, to the guesthouse in Cromer that has built new guestrooms, we can ensure that East Anglia thrives and remains a great place to do business.

: : Steve Elsom, is East Anglia area director for Lloyds TSB Commercial Banking.

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