Chamber survey shows outlook remains positive for GM businesses

Christian Spence, Head of Research and Policy at Greater Manchester Chamber of Commerce

Greater Manchester’s economy is growing faster than the UK average, according to Greater Manchester Chamber of Commerce’s latest Quarterly Economic Survey (QES) results.

Over 400 businesses completed this quarter’s survey, which measures the performance and intentions of businesses across the city region, and is used by key policy makers within HM Treasury and the Bank of England to determine economic decision-making.

This quarter’s results, which precede official data, show that output for the manufacturing sector in the region rose slightly, and the strong recovery in the construction sector continues, with North West figures for new housing and infrastructure higher than their pre-recession peak.

Output in the services sector is still strong, with a slowdown predicted in 2016 returning the figures to historic levels of growth. Retail sales also continue to rise, with consumer demand driving the recovery. Internet sales have tripled in the last ten years in line with changes in consumers’ shopping habits and developments in technology.

However, the Manchester Index™, which brings together seven key QES indicators and acts as a ‘real-time’ tracker for the health of the GM economy, has fallen slightly from 31.3 to 28.5 due to weakening export figures.

Commenting on the Quarterly Economic Survey results, Christian Spence, Head of Research and Policy at Greater Manchester Chamber of Commerce, said: “The outlook remains positive for businesses in our region. Despite the slight fall in the Manchester Index™, which is attributable to a continued weakness in global demand, the domestic economy is still strong.

“Employment intentions remain high amongst Greater Manchester businesses, with the construction sector attempting to recruit in large numbers to manage a quickly approaching capacity crisis. Even with manufacturing growth weak by historic standards, levels of employment and recruitment remain strong as the sector seeks to replace an ageing workforce.

“Over half of this quarter’s respondents are actively trying to recruit, but 75% of those are having difficulties filling their vacancies. For construction firms this figure rises to 90%, with strong demand and a shortage of necessary skills cited as the main causes.”

Further results show that investment intentions remain high for both the manufacturing and service sectors, with a slight weakening in the construction sector.