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West of England economy stalls
New data has shown that the West of England’s economy has stalled and unemployment is on the rise amid Brexit uncertainty.
Business West’s latest survey of over 550 businesses has found that even before the EU Referendum, the West of England economy was showing signs of slowing after a positive start to the year. The regular survey of companies in Bristol, Bath and the South West in May and June found that domestic sales were down four per cent and international orders had dropped eight per cent between May and June. All major indicators were below levels seen last year, but while business confidence fell by three points, almost two-thirds of companies remain confident about the year ahead.
Meanwhile the latest data released by the Office for National Statistics showed that unemployment in the region increased 0.2 per cent (8,000 people) in the three months to May 2016.
“This latest rise in unemployment comes as little surprise given the uncertainty brought about by the EU Referendum,” says managing director of Business West, Phil Smith.
“While rising unemployment is never welcome, levels in the South West remain below the national average. There are also encouraging signs nationally for youth employment, which at 13.5 per cent has not been lower since 2005.”
Commenting on the results, Chief Executive of the Bristol Chamber of Commerce and Initiative, James Durie, said: “It’s early days to properly understand what impact the EU Referendum decision has had on business across the South West, beyond that it shows a short term stalling. And our latest survey shows that our region’s economy showed signs of slowing amid the uncertainty leading up to the decision.
“Since the Brexit decision a number of local companies have been telling us that they have decided to lay off staff, raise prices, or scale back on investment plans – amongst a range of responses that also include opportunities to take advantage of the weaker pound.
“Most groups questioned by Business West believe that, despite the current uncertainty, in the long term the future is bright and that British companies are resilient enough to deal with any temporary downturn.
“The business community has backed the devolution deal right from the start and believes it will strengthen this area for the long term and benefit everyone who lives and works here. This deal now going ahead sends out a strong signal of long term confidence and investment.”
Read more: What Brexit means for Bristol house prices
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