October 1, 2020 @ 13:02 by Richard Dawson
The latest results from an influential economic survey show that sales volumes and business confidence have continued to deteriorate in the North East.
Research from the North East England Chamber of Commerce, conducted in association with Durham University Business School, shows that sales continue to be below previous record lows for both the manufacturing and services sectors.
The survey, which produces a balance score across a range of business indicators, saw domestic sales for manufacturers at -40.6 points and -35.6 points for the service sector, with export sales greatly reduced to -25.5 and -24.1 points respectively.
This is the second quarterly economic survey (QES) the Chamber has conducted since the onset of the coronavirus pandemic and the figures continue to lay bare the impact this crisis is having on the regional economy.
Lesley Moody, Chamber president (AES Digital), said: “While there are some signs of increased positivity in these results, the overall level of business confidence remains low.
“Large parts of our business community report a highly uncertain outlook.
“We have been extremely vocal about the need for Government to get on with its ‘levelling up’ agenda.
“Parts of our region are among the worst hit by infection rates and local restrictions, having entered this crisis with above average levels of unemployment and inequality.
“These survey results only add weight to the argument that urgent action is needed to prevent these disparities growing further.”
In addition to COVID-19, barriers which caused difficulties for businesses included an increased level of uncertainty around Brexit and the type of deal with the EU and the potential paperwork and barriers which may result.
There were some areas where businesses reported success mainly relating to the ability to adapt to challenging circumstances and included investment in marketing and advertising, rapid transition to home/remote working and exploration of different markets.
Karol Marketing’s managing director Stefan Lepkowski added: “After the initial shock of lockdown, many businesses have woken up to the fact that they are now operating in a very different market and one full of opportunities to do things differently.
“Normally in a recession the first thing to get cut is the marketing budget but business can no longer rely on the old ways of doing things.
“For the moment, the days of door knocking salesmen, exhibitions, corporate hospitality and networking as a way of doing business are gone.
“We are finding that clients, old and new, are keen to ramp up PR, brand building and digital marketing activity to get the message out.”