Regional economy slides as Brexit uncertainty and high-street fears bite

15th January 2019

Business West’s local business survey – the South West’s largest private sector survey of business sentiment – showed that 2018 closed with some disappointing results for businesses, with worries mounting over the state of the Brexit deal.

The Government’s lack of progress in securing the UK’s withdrawal from the European Union prompted some angry comments from respondents:

“I don't know what is happening with the plan to leave the EU. Nobody does. Running a business in such uncertain times is like trying to plan for a visit to Narnia or Middle Earth.” said one Bristol business leader.

“Seeing that we are a family business and established in 1904. We have survived two world wars and recessions, but have diversified and thrived. This is very different, with a very uncertain future in both transport and engineering.” commented the director of a North Somerset property business.

The silver lining to Brexit uncertainty in previous quarter’s surveys has been an uplift export orders and export sales, but these were both down 17% year-on-year. One business owner in Bath described how “multiple clients are holding off decisions until clarity emerges [on Brexit].”

Whereas the managing director of a Wiltshire-based leisure business commented that “for the first time in 23 years I see little prospect of growth and little opportunity for me to improve the situation through my efforts or actions.”

Recent troubles on the high-street and lagging consumer confidence, which hit a 5 year low in December, also weighed heavy on a number of businesses minds

One retailer in Salisbury commented: "The country as a whole is very uncertain at the moment and that filters down to individual customer behaviour. City centres are also very uncertain places at the moment trade wise - large retailers are struggling and that impacts smaller retailers and their confidence in their ability to plan, trade and invest. Added to that Salisbury is experiencing another layer of uncertainty and lack of footfall which exacerbates things further for us."

The survey also found a 1% fall in domestic sales on the previous quarter and growth in domestic orders grinding to a halt – a finding which tallies with recent disappointing GDP figures.

Commenting on the findings Phil Smith, Managing Director at Business West said:

“Another quarter, another set of disappointing results – this has been a recurrent theme ever since the referendum of 2016.

“Uncertainty about Brexit and worries over the macro environment continue to weigh heavy on business performance and confidence in the West. Whatever the outcome of the Brexit negotiations, it is our role to help businesses.  We’ve been doing it for 200 years - through good times and bad – and once the government finalises negotiations, we will continue to guide businesses with advice and export documentation support.”

A report detailing the survey's findings can be found here.

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