Recruitment difficulties remain one of the biggest concerns, with record numbers of firms in the region struggling to find the right talent to fill vacancies.
The Quarter 2 Business Report from Greater Birmingham Chambers of Commerce shows that recruitment difficulties are at the joint highest on record – 76 per cent of those who attempted to recruit experienced difficulties.
The crisis was highest in the manufacturing sector, where 82 per cent of firms were struggling to recruit compared with 74 per cent in the service sector.
Recruitment problems are among several factors reflected in this quarter results caused by the impact of soaring levels of inflation, exacerbated by the conflict in Ukraine and the global energy crisis.
GBCC has pledged to work closely with businesses to ensure they are primed to maximise all job opportunities, like those presented by HS2 and the Birmingham 2022 Commonwealth Games.
Henrietta Brealey, GBCC’s chief executive, said: “Persistent issues around accessing talent remain apparent as a record proportion of businesses faced recruitment difficulties.
“Within this context, the importance of projects and events such as High Speed 2 and the Birmingham 2022 Commonwealth Games becomes even more apparent given the opportunities they present to upskill local talent across the region.
“As a chamber, we will be working closely with businesses to ensure they are primed to maximise the opportunities that these once-in-a-generation projects will bring.”
While the price index balance score reached a record high as a growing number of businesses face pressure to raise their prices and a record percentage of businesses expressed concerns in relation to the impact of inflation on their business, the report reflected an underlying resilience from the Greater Birmingham business community.
An increase in Uk sales was reported by 48 per cent of firms - down six percentage points on the first quarter of the year, but export sales have improved by two points with 34 per cent of firms reporting an increase. Also 31 per cent of manufacturers reported an increase in exports, an increase of 11 points.
On other positive notes, 30 per cent of businesses reported that their workforce had grown over the past three months and 42 per cent expect their workforce to grow over the next three months.
Ms Brealey added: “The results from the latest quarterly business report offer a timely reminder of the underlying resilience of the local business community as we look forward to hosting the biggest sporting spectacle this city has ever witnessed: the 2022 Commonwealth Games.
“In particular, sentiment on domestic activity for firms across the region remains strong. This quarter also showed welcome improvements on sentiment on export activity too – a testament to the ability of Greater Birmingham businesses to navigate the continued fallout from the Covid-19 pandemic and the UK’s formal departure from the European Union.
“It was also promising to see high proportions of businesses expecting their profits and turnover to increase over the coming twelve months in spite of the well documented challenges businesses are grappling with on a daily basis.”
Professor Julian Beer, deputy vice-chancellor of Birmingham City University, who support the report, said: “The Q2 survey was framed against rising inflation and the cost of living crisis which is threatening business recovery, and testing the resilience of the Greater Birmingham economy.
“At the time of writing, prices were rising by 9.1 per cent a year in the UK – the highest rate for 40 years, whilst the Bank of England warned that inflation could hit 11 per cent. The survey results reflect this landscape with decreased levels of business confidence in turnover and profitability, limited labour force growth, and anticipated increases in the price of goods/services evident.”
A full briefing on the Q2 report will take place at Birmingham City University on July 19 at 9am. The event will also focus on digital adoption and technological innovation in Greater Birmingham. Speakers include Kasam Hussain, regional partnership director for Openreach,and Lee Johnson, chief technical officer at Air IT.
To book a place go to greaterbirminghamchambers.com