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Business confidence returning to South West
12 August 2009
South West businesses say they are in a good position to weather
the downturn over the coming year, according to the region's top
economists.
Nearly three quarters of the businesses surveyed for the South
West RDA (Regional Development Agency) in May and June believe they
will survive continuing economic pressures over the next 12
months.
The figures are published in the latest edition of the South
West RDA's Economics Review, which also indicates that the increase
in confidence has been felt by both manufacturing and service
companies across the region. The survey quoted in the Review shows
that manufacturers have begun to rebuild stocks and the services
sector have seen more orders being placed.
However, RDA economists remain cautious on whether this is a
return to normality, as most current measures of business
performance remain strongly negative. For example up to one third
of business surveyed are still taking measures to cut labour costs
- from shedding staff to reducing hours.
Nigel Jump, chief economist at the South West RDA, said: "We
continue to be pleasantly surprised at the extent of business
optimism within the region, which extends across sectors and
places. However, whilst there has been a boost to South West
activity from a recent bout of restocking, it is not clear that a
sustained recovery is yet underway.
"There are a few short-term factors that could be seen as
potential threats to the recovery within the South West, such as
the levels of discretionary income and the effects of the swine flu
pandemic." Mr Jump continued: "On balance, the effects of swine flu
on the economy are likely to be negative but should be
short-lived."
This quarter's Economics Review also contains special papers on
the ramifications of the downturn for tourism in the South West,
housing and the labour market.
For further information about the current economic picture in
South West England, please call the press team to arrange an
interview with Nigel Jump.
The full text of the review is available at Economics
Review.
Ends
Notes to editors
1. The South West RDA leads the development of a sustainable
economy, investing to unlock the region's business potential. It is
helping companies respond to the economic crisis and charts a
course for recovery. The RDA is developing or expanding initiatives
which include: establishing a Business Loan Fund; coordinating the
response to large companies in difficulty; preparing for economic
recovery.
For more details contact: RDA Press Office, 01392 229389
Contact Details
Name: Claire Wickes
Tel: 01392 229 389
Email: claire.wickes@southwestrda.org.uk