By Daniel Hunter

There is a green light at the end of the tunnel to business prosperity and businesses in Greater Birmingham are reporting improved turnover confidence on the domestic front.

Birmingham Chamber of Commerce Group’s first quarterly economic survey for 2013, covering Birmingham, Solihull, Burton, Chase, Lichfield and Tamworth Chambers, demonstrates clear business progress as 43 per cent of firms in the service sector say that domestic sales have increased, up from 36 per cent at the end of 2012. Forty two per cent have seen advance orders increase, a figure which has risen from 33 per cent.

“This is further good news for businesses battling access to finance, taxation and regulation," Steve Brittan, president of Birmingham Chamber said.

In the manufacturing sector, the survey shows that business expectations for an increase in turnover and profitability have risen. 59 per cent of manufacturers reported improved turnover confidence and 61 per cent reported increased confidence in profitability, up from 55 per cent and 50 per cent respectively.

But the service sector has reported the greatest increase in business expectations for turnover and profitability. 70 per cent of service businesses reported increased turnover confidence up from 60 per cent and 68 per cent reported profitability had increased, up from 58 per cent last quarter.

Skills however still remains the key issue for Greater Birmingham businesses. Despite higher unemployment figures, forty one per cent of service businesses reported that they faced difficulties when recruiting professional/managerial staff, while only 7 per cent faced difficulties when recruiting unskilled or semi-skilled labour. And 61 per cent of manufacturers say there are difficulties when recruiting skilled/technical staff.

“This highlights the wider proportion of unskilled labour that the Greater Birmingham region is suffering from. The lack of skills is a major issue which the Government needs to tackle," Steve Brittan said.

"Even the basic three ‘Rs’ (reading, writing and arithmetic) are sadly lacking. The Chamber is campaigning for greater links between business and schools.”

On the domestic front, manufacturing is still waiting for a breakthrough. Only 28 per cent of firms report an improvement in domestic sales, which is down from 33 per cent who reported an improvement last quarter.

And exports are not as good as last quarter as in the manufacturing sector, only 31 per cent of firms saw export markets improve, compared to 37 per cent last quarter. Looking to the future, 26 per cent of firms say that foreign advance orders have increased, but again this is down from 35 per cent last quarter.

“On behalf of its members, The British Chambers of Commerce overseas initiative which encourages links between accredited overseas Chambers abroad, will help make the export process much easier for UK businesses and hopefully encourage more companies to take the plunge. And the West Midlands Chambers of Commerce is about to launch a one stop shop initiative to help businesses export," Steve added.

Again, in the services sector, only 27 per cent of firms saw export advance orders increase which has come down from 32 per cent last quarter. Thirty five per cent of service companies saw export sales increase, but this is down from 40 per cent.

While pre surveys have highlighted access to finance as a key business issue, concern in both sectors, has shifted towards competition.

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