Henrietta Brealey, chief executive of the Greater Birmingham Chambers of CommerceBusinesses in Greater Birmingham are predicting a turnover and profitability boost in the coming months amid an economic environment ‘marked by both caution and optimism’, according to a major economic report released earlier this week.
Greater Birmingham Chambers of Commerce’s latest
Quarterly Business Report indicates a buoyancy among firms about the prospect of increasing their turnover and profitability.
The Q3 report, sponsored by Birmingham City University, reveals 65% of businesses expect to increase their turnover over the next 12 months — up from 58% in Q2 — while 25% expect it to remain constant and just 10% anticipate a decrease — and 57% expect profitability to improve over the coming year, a 2% increase on the previous quarter.
GBCC chief executive Henrietta Brealey said the figures are “a testament to the underlying resilience of local businesses.”
Recruitment activity was relatively stable during Q3 — with 30% firms increasing their headcount (up 1% from Q2) and 11% experiencing a decrease (unchanged from Q2). However, there was a 4% increase in businesses reporting recruitment difficulties (67%). It was a particularly challenging quarter for the manufacturing sector — of the 59% of firms who attempted to recruit, 85% reported difficulties.
Ms Brealey added: “From a local perspective, the latest Q3 report reveals that domestic sales activity fell slightly compared to the last quarter and export sales continue to suffer from geopolitical tension as the trade deficit widened from a national perspective over the summer. Recruitment activity remained stable in Q3 but ingrained challenges remain for those attempting to hire.”
Business confidence She continued: “Despite the national fall in the rate of inflation, price pressures remain prevalent for the majority of businesses across the region with investment in both training and capex falling across both indicators in the last three months. Nevertheless, business confidence across profitability and turnover projections remains strong and is a testament to the underlying resilience of local businesses.
“With the publication of the Autumn Budget, the Government will now need to work closely with the business community to ensure that their blueprint for growth remains anchored in pragmatism and takes into account the various challenges local firms continue to face.”
Professor Harris Beider, pro-vice-chancellor, engagement, enterprise and innovation at Birmingham City University, said: “The Q3 report highlights a complex economic environment marked by both caution and optimism among businesses. While there is a decline in international demand and rising concerns about potential tax policies, as well as anticipated price increases, there is also a growing sense of optimism among firms in the West Midlands reflected in improved business confidence and expectations for increased turnover and profitability.
“Accelerated adoption of AI technologies will serve to catalyse economic growth across key sectors, such as manufacturing, healthcare, and finance. With a robust industrial base and a thriving start-up community, Greater Birmingham is poised to capture increased economic benefit and productivity as a result of AI-based innovation.”