Businesses rarely stop investing because they have lost ambition. More often, they pause because confidence gives way to uncertainty.
That is one of the clearest messages to emerge from the latest Quarterly Economic Survey (QES) from the British Chambers of Commerce. Now in its 38th year, the QES is the UK’s largest independent survey of business sentiment and one of the country’s most influential economic indicators, helping shape discussions with HM Treasury, the Bank of England and policymakers. Every response from businesses across the Chamber network helps ensure business voices are heard where national economic decisions are made.
The findings paint a picture of a business community that remains resilient but is becoming increasingly cautious.
Investment intentions have fallen to their lowest level since the pandemic, with just 17% of businesses planning to increase investment over the next three months, while 26% expect to reduce it. Confidence has softened too, with only 44% expecting turnover to improve over the next year, compared with 49% in the previous quarter, while almost one in four (23%) anticipate a decline. Domestic sales have also weakened, with fewer than a third (29%) of firms reporting growth during the last three months.
Inflation has once again become the biggest concern for UK businesses, cited by 66% of respondents. Labour costs remain the greatest cost pressure, while rising fuel prices and ongoing geopolitical uncertainty are adding further challenges for organisations trying to plan ahead. Nearly half (48%) of businesses also expect to increase their prices over the next three months as cost pressures continue.
None of this suggests businesses have become less ambitious – far from it. It tells us that many are taking a measured approach, balancing the desire to grow against an increasingly complex economic environment.
The survey also reinforces something we hear consistently from businesses across Bedfordshire: finding the right people remains one of the biggest barriers to growth. Almost three quarters (73%) of businesses attempting to recruit continue to experience difficulties finding suitable candidates. Just 23% expect to increase the size of their workforce over the coming months, while 66% plan to maintain current staffing levels and 11% expect to reduce employee numbers. Many businesses are not short of opportunities; they are short of the skills and capacity needed to take advantage of them.
Investing in the workforce already in place is becoming just as important as attracting new talent. With 58% of businesses continuing to report skills shortages and only 20% increasing investment in workforce training during the last quarter, it is clear that supporting employers to develop their existing teams must form part of the solution.
Here in Bedfordshire, we’re already seeing these challenges reflected in conversations with our members.
Our county is entering a period of significant opportunity. Major investment projects, including Universal Destinations & Experiences, the continued expansion of London Luton Airport and wider regeneration across Bedfordshire, have the potential to create thousands of opportunities for local businesses. But opportunity alone is not enough. To make the most of this investment, businesses need confidence, certainty and the capability to compete.
That’s exactly why we launched BedX to help businesses become procurement ready, strengthen their bidding capability and build the relationships needed to access opportunities linked to major investment projects across the county. At a time when many businesses are understandably cautious about investment, BedX is helping them prepare with practical support, expert guidance and the connections needed to compete confidently for future opportunities.
Alongside this, we continue to represent Bedfordshire businesses through the British Chambers of Commerce network, ensuring the experiences of our members help shape national policy on investment, skills, taxation and economic growth.
The latest QES reminds us of an important point. Sustainable economic growth depends on more than positive economic forecasts. It requires confident businesses, a skilled workforce and a policy environment that gives employers the certainty to invest for the long term.
I’d also encourage businesses across Bedfordshire to take part in future Quarterly Economic Surveys. Every response strengthens the evidence we present to Government and helps ensure the voice of Bedfordshire business is heard where it matters most.
The stronger our local participation, the stronger our collective influence becomes.
Bedfordshire has every reason to be optimistic. We have an ambitious business community, significant investment on the horizon and a wealth of opportunity ahead. By preparing today and working together, we can ensure local businesses are ready not only to navigate today’s economic challenges but to seize tomorrow’s opportunities.
For further information about becoming a Bedfordshire Chamber of Commerce member, call the team on 01582 522448, or visit their website.
