Business leader puts celebrations on hold as Northamptonshire economy begins to bounce back

The report reveals a significant number of companies are reporting increasing sales at home and overseas as they battle to recover from the enforced closure of large parts of the economy.

It means that many employers now say they do not expect to be making redundancies in the forseeable future.

The upturn in confidence and business activity has been captured in the latest quarterly survey of the county’s economy by the Northamptonshire and Milton Keynes Chamber of Commerce.

But interim chief executive Louise Wall sounded a note of caution pointing out the upbeat survey for the third quarter of the year followed the historic lows of lockdown during the previous quarter.

And she warned that any celebration of recovery should wait as a good number of companies were still embroiled in a tough battle to survive.

Her comments come as Corby-based RS Components, which employs 2,000 staff in the town, announced that 208 jobs were at risk as the company restructured.

Ms Wall said: “Although it is heartening to see a broad improvement in the results reported for quarter three, we must be mindful that this is in contrast to the worst results ever reported in quarter two, and sadly, many businesses continue to struggle with the challenges posed by the Covid-19 lockdown.

“If the economy was fully bouncing back, we would expect to see a more significant rise than we have – sadly, this is not yet a time to celebrate.

“As a Chamber we are aware of the damage uncertainty wreaks on the amazing businesses we proudly represent, and we fully support the British Chambers of Commerce call on the government to provide further support and the strengthening of measures that underpin business confidence.”

According to the chmaber’s survey, 55 per cent of businesses that took part in the survey are expecting no change to their workforce over the next three months.

Confidence has also risen with 51 per cent of businesses stating they believe turnover will improve over the next year compared with 31 per cent in the second quarter.

Just 29 per cent believe profitability will worsen, which is down on the 52 per cent that anticipated a profits fall in the second quarter.

The number of businesses recording an increase in domestic sales was up from 10 per cent in the second quarter to 41 per cent in the third quarter with those seeing a decrease falling from 75 per cent to 38 per cent.

Businesses enjoying an increase in domestic orders rose from nine per cent to 34 per cent with the number recording a decrease in orders dropping from 79 per cent to 40 per cent.

Despite a rise in the number of firms seeing an increase in overseas sales and orders, there were still more companies reporting a decrease in sales and orders.

The net balance of firms recording an increase in sales/customs/bookings rose by 36 per cent, from -63 per cent in quarter two to -27 per cent in the third quarter. Net overseas orders rose from -66 per cent in the second quarter to -27% in the third quarter.

Asked to cite their concerns for the future, most (38 per cent) stated competition was the foremost headache.

However, 49 per cent cited ‘Other Concerns’ with 37 per cent of those mentioning Covid-19 and 21 per cent highlighting Brexit.

The survey concludes: “This (Brexit) is clearly a significant concern and it is unfortunate that the important preparations needed by many firms could be missed due to the Coronavirus pandemic.”

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