A statement from Nova Fairbank, CEO of Norfolk Chambers of Commerce. “Norfolk Chambers of Commerce is greatly saddened to learn of the death of Her Majesty The Queen. “As the patron of our national body, the British Chambers of Commerce, she was a great supporter of the nation’s business community, for which we are incredibly grateful. On behalf of all of the Chambers team, our board members, partners, and the wider Norfolk business community, we would like to extend our heartfelt condolences to the Royal Family at this time on their profound loss.”
Reacting to the announcement of the new Prime Minister, Nova Fairbank, CEO of Norfolk Chambers, said: “We would like to congratulate Liz Truss on running a successful campaign to become the UK’s new Prime Minister.
“She must now take immediate steps to support the economy. The last few months have been difficult for everyone, time is running out and urgent action is needed to deal with the costs’ crisis.
“We believe the country has already entered a recession and that inflation will hit at least 14% in the months ahead.
“Like households, firms have been telling us of unsustainable rises in their energy bills and how difficult it is to find new fixed term contracts to buffer against further price hikes.
“Unless the new Prime Minister addresses these problems head-on then the economy will drift further into dangerous waters and the outlook for both businesses and consumers will be bleak indeed.
“The British Chambers of Commerce on behalf of the wider Chamber network set out a five-point action plan to support businesses at the end of August and sent it to the Treasury and Liz Truss’ team. It is now imperative that we see movement on our proposals.
The BCC five-point plan has the full endorsement of Norfolk Chambers of Commerce, which in turn provided evidence from the county’s businesses and is aimed at supporting businesses by:
Ofgem to be given more power to strengthen regulation of the energy market for businesses
Temporary cut in VAT to 5% to reduce energy costs for businesses
Covid-style support by introducing Government Emergency Energy Grant for SMEs
Temporarily reverse employer NIC and put money back into the pockets of businesses and workers
Government to immediately review and reform the Shortage Occupation List (SOL) to help bring down wage pressures and fill staffing vacancies
“We congratulate Ms Truss on her appointment as Prime Minister and strongly encourage her to adopt the Chamber network’s five-point plan. The plan is not solely about ensuring support for businesses. It is also about protecting jobs, securing livelihoods, and creating a vibrant and prosperous society for everyone. Good business is good for Norfolk, and we want to work in collaboration with Ms Truss and her new government to support local businesses, and the individuals that run them, to ride out this economic storm.
“Similarly, we are keen to ensure that Norfolk benefits from levelling up investment. At a recent campaign husting in Norwich, Ms Truss advised that, as the MP for South West Norfolk for the last 12 years, she had a strong understanding of the region and its strengths, but also the challenges we face.
“She promised to deliver levelling up for not just her constituency and Norfolk, but for the whole of East Anglia. She pledged to look closely at dualling the whole of the A47, as well as considering the commitment to the Norwich Western Link Road and the improvements of Ely railway junction – all of which would support economic growth, housing and jobs in Norfolk.
“Norfolk Chambers and our members look forward to collaborating with our new Prime Minister and her Ministers to deliver greater economic growth and opportunities for our region.”
Image originally supplied for a Dept. of International Trade webinar
The British Chambers of Commerce expects the UK economy to plunge into recession before the end of 2022, with inflation spiking to 14% and lingering weakness in growth expected to continue into 2024UK Economic Outlook – 2022
BCC has again downgraded its expectations for UK GDP growth for 2022 to 3.3% (from 3.5% in Q2) against a deteriorating economic outlook.
UK inflation is now expected to reach 14% in Q4 2022, an upwards revision of four percentage-points from its previous projection of 10%.
The BCC is now forecasting a recession for the UK economy this year, with negative economic growth for Q2, Q3, and Q4 2022
Short-term GDP expected to go into recession In the short term, the BCC is now forecasting a recession for the UK economy with three consecutive quarters of contraction between Q2 and Q4 in 2022. Annual expectations for GDP growth also continue to decline, with 3.3% forecast for 2022, significantly below the 7.4% growth recorded in 2021. However, unlike the Bank of England, the BCC expects the economy to grow in 2023, albeit at a very low 0.2%, with a slight increase to 1% in 2024. These anaemic predictions for GDP growth are in light of deteriorating economic conditions; rising energy costs, a decline in household spending and real wages; weaker export prospects and a pessimistic global economic outlook; poor investment conditions and weakening business confidence and cashflow. Many of these issues were initially caused by the global response to Covid-19 and have been further compounded by the war in Ukraine. Inflation to peak at 14% Businesses and consumers will continue to face exceptionally high costs as rampant inflation spirals upwards in 2022. Increased and more sustained inflationary pressure is now forecast for Q4 2022, as the Consumer Price Index (CPI) inflation rate is expected to reach a peak of 14%. This is up from the previous, already high, projected rate of 10%. The CPI rate is expected to slow to 5% in 2023, and finally return to the Bank of England’s target of 2% in 2024. The forecast for the Bank of England’s interest rate remains unchanged; the rate is expected to increase from 2% in 2022 to 3% in 2023 and 2024. Inflation is expected to outpace growth of earnings by over 3:1 in Q4 2022, with average earnings increasing by 4.5% in Q4 2022. Investment and recovery expected to be anaemic Business investment is set to grow at 2.7% in 2022, an upward revision from the Q2 forecast of 1.8%. This is likely to be driven by growth in building construction rather than spending on machinery or equipment. However, it is expected to increase by only 0.6% in 2023, slightly down from the 0.8% growth predicted in Q2. Overall investment is expected to grow by 4% this year but shrink by 0.4% in 2023 before rebounding to 1.1% in 2024. Consumer spending is now forecast to grow at 3.8% in 2022, a fall from the 4% predicted in Q2. Commenting on the forecast, Alex Veitch, Director of Policy at the British Chambers of Commerce, said: “Our latest quarterly economic forecast will not be of any comfort to either consumers or businesses. The extreme inflationary pressures already present are only likely to increase as we head towards Christmas; with the UK economy already thought to be in recession. Tackling these pressures must be at the top of the new Prime Minister’s inbox when they take up their position next week. “We have revised our projected inflation rate upwards by four percentage-points to a new high of 14%. Inflation is running rampant, and it is not only impacting the cost of doing business, but also the ability of some firms to keep their doors open. In January, the BCC found that 23% of businesses surveyed were looking to scale down or even consider closure in response to rising costs. “With prices spiralling out of control, they are expected to race ahead of earnings growth by a ratio of 3:1 in Q4 2022. This will undoubtedly impact consumer confidence, another key concern for businesses. “Action is needed now, and the BCC has set out a comprehensive plan for Government to provide vital support to firms. “Along with taxation and labour measures, the BCC business support plan includes key asks to help businesses with spiralling energy costs. These include Covid-style support by introducing a Government Emergency Energy grant, a temporary cut in VAT on energy bills to 5% to reduce costs for firms and increased regulation of the energy market for businesses by Ofgem. “Through our extensive research and forecast work, we know the problems currently facing businesses. Time is fast running out, the Government must step up to the plate and do what is needed to protect businesses, livelihoods and jobs.” Key points in the forecast:
UK GDP growth forecast for 2022 is 3.3%, 0.2% in 2023 and 1% in 2024
Following a contraction of growth in Q2 2022 by 0.1%, quarter-on-quarter GDP growth is forecast to continue to decline in Q3 by 0.1% and Q4 by 0.3%, before a slight increase in growth of 0.2% in Q1 2023.
Household consumption forecast is for growth of 3.8% in 2022, growth of 0.3% for 2023 and 1.1% in 2024.
Business investment forecast is to grow by 2.7% in 2022 before more than quartering to 0.6% in 2023, and then rising to 1.2% in 2024
BCC expects export growth of 2.3% in 2022, 1.8% in 2023 and 1.2% in 2024, compared to import growth of 7.7%, -3.8% and 1.6%
BCC expects UK unemployment rate of 3.8% in 2022, before rising to 4.1% in 2023 and 2024
CPI inflation is forecast to peak at 14% in Q4 2022, before falling to 5% by the end of 2023. Inflation is expected to drop back to the Bank of England’s 2% target by Q4 2024
UK official interest rates are expected to rise to 2% by Q4 2022 and then to 3% in Q4 2023, ending 2024 at the same level.
Our Co.next programme was launched in early 2022 to empower, engage and encourage young professionals across Norfolk. The programme has developed and grown providing valuable support, training, mentoring, and events. A gap in the market was brought to our attention by those 35 and under – the need to bridge the gap between leaving education and gaining knowledge, experience, and confidence to climb the career ladder. Our concept has been developed from idea through to fruition thanks to our first Advisory Board. The board is made up of seven young professionals on a variety of career journeys and have been at the heart of the programme. They have their feet on the ground, sharing their ideas and raising awareness of what support and guidance they actually need. All good things must come to an end, and our first Advisory Board has now completed their term as Advisory Board members. We’ve been so thrilled with their enthusiasm, ideas, and passion that we have since created a Co.next alumni that will be made up of all the Advisory Board members. Their input has been invaluable to getting Co.next off the ground and it’s important to us to continue with their support. James Groves, Co.next Board Chairman says “I am so grateful for what the initial Advisory Board bought to the Co.next initiative. Without them, it wouldn’t have launched with such energy, enthusiasm, and commitment, and for that, I am extremely grateful. I am so excited to keep them involved as we move forward and to get their insights into what we are doing and what we can continue to do to empower, encourage and engage the under-35 professionals of Norfolk. I am also excited to have the opportunity to have new, fresh young professionals join the advisory board and help move us into what should be an exciting year for Co.next.” With so many amazing young professionals in Norfolk, we want to give others the chance to make a difference too, and put their thoughts and ideas forward for the Co.next programme. We’ll be opening the positions soon so watch this space. See our alumni members here.
The region’s two leading business organisations have been handed a key role in helping to identify and support the delivery of the long-term skills needs of businesses. Norfolk Chambers and Suffolk Chamber of Commerce have been designated as the ‘employer representative bodies’ to run the Local Skills Improvement Plan (LSIP) across the two counties. LSIPs are a key initiative from the Skills & Post-16 Education Act and are designed to ensure a wider role for employers in ensuring an enhanced balance between the demand for particular types of skills and the supply of course from both FE colleges and private training providers. Nova Fairbank, Norfolk Chambers’ chief executive said: “Our LSIP will aim to reach many of the companies that have not previously engaged with the further education system. This will allow us to identify specific unmet needs and help to accelerate the delivery of courses to meet those needs. “These are exciting times for both counties and it’s great that the two Chambers have the opportunity to fulfil such a pivotal role in engaging employers with the skills agenda.” John Dugmore, Suffolk Chamber’s chief executive added: “This is good news for both Chambers and for the tens of thousands of businesses in Norfolk and Suffolk as LSIPs put the employer voice at the very centre of future skills planning. “Based on our existing strong and collaborative working relationships with the region’s colleges, universities, other training providers, county councils, other business bodies and the New Anglia LEP, we are confident that our LSIP will make a contribution to our regions’ improved competitiveness and growth.” The Chambers are part of a 32-strong cohort of chambers which will lead LSIPs across the country, supported by the British Chambers of Commerce (BCC). Jane Gratton, from the British Chambers of Commerce, said: “We are delighted that so many accredited chambers have been designated by the Secretary of State for Education. “The Chamber Network will use its convening power and deep knowledge of their local economies and communities to develop clear plans to address skills challenges faced by businesses. “This is an opportunity for employers to shape how their current and future workforce can access the right training to thrive in the modern, more digital and greener workplace.” In setting up the LSIP, Norfolk and Suffolk Chambers will launch a major engagement programme to reach as many businesses as possible with the aim of identifying the regions’ key skills needs. They will then work with the FE colleges, training providers and a arrange of enablers, including the voluntary sector, local authorities and other business organisations across the two counties to find ways in which these skills needs can be addressed.
Workers at Felixstowe port started an eight-day strike on Sunday (21st). Services being imported and exported from Felixstowe are likely to be affected for the next 8 days. The strike is likely to cause longer wait times for goods being cleared at the port, they have advised if possible to use other ports or delay shipments. With nearly 2,000 workers striking it has been estimated to disrupt more than $800 million in trade.
The Communication Workers Union (CWU) has called on its members who collect, sort, and deliver parcels and letters to take strike action on the following dates: • Friday 26 August 2022 • Wednesday 31 August 2022 • Thursday 8 September 2022 • Friday 9 September 2022 Due to these strikes, we may not be able to guarantee next-day delivery for any documentation produced in the days leading up to and after the strikes. The latest news on the strikes can be found here
Norfolk’s young people are making important decisions about their future career based on their A Level results, released today (Thursday 18th August). We are confident their hard work will have paid off with excellent results, but employers also value personality and experience. Now, it is time to think broadly about the opportunities available. Whilst university has been the traditional next step, it is not always the right opportunity for everyone. Whilst recent research has highlighted an ‘image problem’ with apprenticeships, many of Norfolk’s young people are seeing the advantages and benefits and taking this opportunity. Nova Fairbank, CEO at Norfolk Chamber said: “Young people have many options open to them and I would encourage those students who have received their ‘A’ Level results today to consider all options, including an apprenticeship. With modern advanced apprenticeships, young people can have a fantastic opportunity to access great training, develop skills and gain qualifications whilst working for an employer.” The following useful tips can help young people understand what options are available whatever their results:
Norfolk’s careers information, advice & opportunities website: Help You Choose for a range of courses available post A levels; degrees, Foundation Degrees, HNDs and other courses at the same level. You can tailor your search by educational establishment, subject, qualification or location. It tells you how to apply, and different sources of finance which might be available.
Commenting on the Office for National Statistics inflation figures for June 2022, Nova Fairbank, CEO for Norfolk Chambers, said: “The rise in Consumer Prices Index inflation to 10.1% is the tenth monthly increase in a row and another record high.“This higher than expected inflation increase, alongside eye-watering energy prices, confirms the severity of the cost of doing business crisis. “This squeeze on businesses’ operating costs is also reflected in the latest Producer Price Inflation figures which show a 22.6% rise in the year to July 2022, which remains among the highest levels since records began in 1985.“The difference between input and output inflation illustrates that many firms are absorbing as much of these additional costs as they can. There is a limit to how much additional cost firms can absorb and is limiting growth and investment.“Our research shows that two out of three firms expect to raise their own prices in the coming months, with utilities, labour costs, and raw materials all cited as the main drivers of costs. Firms have been telling us about this inflation shock for 18 months now.“Businesses want to support their people, they want to invest and grow and they don’t want to put prices up for their customers, but they are left with little choice.“The Government should act and has levers to pull to give vital support to businesses now.“The two immediate and impactful choices would be to review and reform the Shortage Occupations List to help fill the 1.3 million job vacancies; and bring businesses’ energy costs down by lowering the VAT rate from 20% to 5%. “It’s time for action and we’re offering solutions. It’s time for Government to listen.”More information on the ONS inflation data can be found here.
The arrival of the summer recess marks a respite period for many (other than Conservative Party leadership candidates and members) from an intense period of policy-making affecting trade. As a new Prime Minister takes office on 6 September, the in-tray on international trade issues will be daunting. Firstly, the prospect of a fully-fledged trade dispute between the UK and the EU is drawing ever closer. The Northern Ireland Protocol Bill completed its Commons stages this week, and was introduced into the House of Lords yesterday. This provides UK Ministers with the legal powers domestically to over-write the Protocol and introduce check free, friction free movements of goods East-West and West-East across the Irish Sea for Great Britain and Northern Ireland. The European Commission is expected to launch new legal proceedings against the UK Government within days for alleged breaches of the Withdrawal Agreement. Should the Bill become law – a prospect still many months away – the EU is expected to respond with further actions including safeguard measures (tariffs) on selected UK exports to the EU while the whole matter is resolved by the dispute resolution machinery in the Withdrawal Agreement and Trade and Co-operation Agreement. The BCC is prioritising a negotiated solution, but potentially affected companies should be taking advice now to mitigate their exposure to new costs on exporting goods to the EU should matters worsen. Second, the UK Government launched its consultation document yesterday on a Single Trade Window (STW) which is designed to be rolled out from December 2023 as part of the new Target Operating Model (TOM). This will incorporate border control processes for goods entering GB from the EU and the rest of the world, including those inbound measures which were deferred from entering into force in the latter half of 2022 (requirements for safety and security certificates, export health certificates, and documentary, identity and physical checks on products of animal origin and plant. products). In time, the STW is designed to provide a single user portal for a range of border and customs processes and greater efficiency in holding times for goods. A range of other countries are also progressing their Single Customs Window plans too, including the EU. Third, an autumn campaign on preference utilisation rates among SMEs is being prepared for roll out. The BCC is involved in discussions with the UK Government about outputs and delivery of this, following our research findings from members that awareness and ways to use new trade agreements being made by the UK with other trading partners was very low. The aim is to increase volumes of exports and numbers of companies exporting. Initially five markets will be prioritised: Australia, New Zealand, Singapore, Japan and Norway. The Australia and New Zealand free trade agreements are expected to be ratified later in the autumn and take effect early next year after legislation at Westminster on procurement and amendments to the tariff schedule are passed. Fourth, an intensive series of negotiating rounds will be required to complete some and progress other key trade negotiations. Negotiations with India are expected to be completed in time for 24 October – the BCC has had sight of some negotiating drafts in key areas. Canada negotiations for a bespoke trade agreement are expected to conclude by the end of the year to tie-in with UK accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Negotiations with the Gulf Co-operation Council, Mexico and Israel are getting underway but may not finish into 2023. Fifth, delivering an export strategy which provides a pathway to stronger export-led growth will be key this year. The Office for Budget Responsibility forecast in last autumn’s Budget export growth between 8-9% this year. Trade data from the first half of this year puts UK export performance short of that growth trajectory. The BCC is putting plans to DIT to remedy that and boost export volumes. So a busy autumn ahead, as well as unpredictable events such as the impact of the war in Ukraine on supply chains. Keep in touch with ChamberCustoms and the BCC as we guide you through this uncertain period and reach together better times ahead. Have your say. Let us know your opinions Photo credit: Chamber Canva Pro You can view this original article here on the BCC website
Commenting on the latest ONS Labour Market statistics released today, BCC Head of People Policy, Jane Gratton, said:
“The labour market remains incredibly tight adding to the growing list of concerns businesses are facing. This is a ticking timebomb for firms up and down the country.
“Today’s figures show little improvement for employers over the last quarter. Despite the small increase in employment levels, the number of job vacancies in the economy remains around the highest on record. Competition for skills and labour continues to drive up wage costs.”
“Skills and labour shortages have reached crisis point for many firms. The impact is being felt on their ability to meet customer demand and forcing some to turn away new business, because they simply do not have the human resource. This is restricting growth and business confidence. It’s a serious and urgent problem.
“On top of all of this, firms are now grappling with the highest inflation in almost 40 years; the largest spike in interest rates in three decades; ongoing supply chain disruption; and eye watering energy bills. There is a limit to how much additional cost business can absorb.
“The Government can help ease the growing pressure in the labour market at no extra cost to the Exchequer. We need an immediate review and reform of the Shortage Occupations List (SOL) to include more jobs at all skill levels. This will give firms breathing space to train and upskill their workforce. We have over a million more job vacancies than people available to work, so the sooner we start the SOL review, the better.
“We also need to encourage economically inactive people back into the UK labour market through access to publicly funded rapid retraining opportunities. Businesses must be part of the solution too by creating the right workplace conditions, for example by providing flexible working practises, training opportunities and a focus on workplace healthcare and support.
“We cannot see another month of the same old news, it’s time for action and we’re offering the solution. It’s time for the Government to listen.”
The outlook for global trade remains weak for 2022, according to a new study published this week by the UN Conference on Trade and Development. The report finds that although trade values are continuing to rise (partly down to inflation-led price rises), trade volumes are almost stagnant. An update on live and forthcoming UK trade negotiations: CPTPP (11-strong nation block in Asia-Pacific) accession – set to be completed by the end of 2022. India – high-level deadline set for 24 October 2022 for completion of negotiations. Canada (upgrading the continuity agreement) – have commenced, due to be completed by end of 2022. Mexico (upgrading the continuity agreement) – have commenced – no deadline for completion. Gulf Co-operation Council (Saudi Arabia, Qatar, Kuwait, UAE, Bahrain, Oman) – first round taking place this month. Israel (upgrading the continuity agreement) – negotiations launched, likely to get underway in coming weeks. Switzerland (upgrading the continuity agreement) – likely to get underway in the autumn. Future negotiations: South Korea (upgrading the continuity agreement). Australia and New Zealand agreements on track for ratification before end of 2022 and entry into force early next year. If you need support trading across the world please get in touch with our International Trade team here. Image credit: Chambers Canva Pro 2022