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10
Oct
Chamber reveals gloomy Yorkshire data ahead of next month's Budget
Yorkshire businesses are increasingly reporting falling sales and declining profits, new data from West & North Yorkshire Chamber of Commerce shows.
The Chamber’s latest Quarterly Economic Survey shows that the region’s firms are still being impacted by high overheads, specifically from taxation and labour costs, dampening revenue and profit forecasts.
The Harrogate district is not immune to the trend. The Stray Ferret asked Phill Holdsworth, president of the Harrogate District Chamber of Commerce, about business sentiment in our area. He told us:
We're seeing a real squeeze on businesses in the district, particularly small and medium-sized ones.
Last autumn's budget felt like a death knell, and put a lot of strain on businesses, especially in terms of future growth.
Business rates are particularly high too – in some cases higher than a company's rent – and that's obviously restrictive in terms of what businesses can do.
The cost of materials is also high, as well as energy, and we've just heard the water companies are going to be allowed to put up their prices.
The big concern now is the Budget statement next month. [Chancellor of the Exchequer] Rachel Reeves (pictured) has already said it's going to be a tough one. But how much more can businesses take?
The government's Autumn Budget is due on November 26, and West & North Yorkshire Chamber of Commerce is warning of negative consequences for the economy if further levels of taxation are imposed on employers.
Speaking about the newly published data, Mark Casci, its head of policy and representation, said:
Given the significant challenges facing the region’s business community of late, it is sadly unsurprising to see such a gloomy picture emerging.
As a chamber, we have been warning for more than a year about the deleterious impact that last year’s Budget tax hikes would have on our members.
The proof is now being shown in these latest figures which show a slowdown in sales, most notably overseas, and profits.
The Treasury must now understand in the strongest terms that any further increases in taxation on employers will only serve to further weaken the economy.
The chamber did point to some crumbs of comfort in the report, however. Employers are showing a slight increase in hiring intent, as well as an improved appetite to invest in upskilling their existing workforces.
David Bharier, head of research at the British Chambers of Commerce, said:
Ahead of the Chancellor’s statement next month, our survey shows many firms remain bruised and are not ready for another Budget battering. The research reveals no clear improvements to key indicators we track. For 12 months, SMEs have told us the same story: rising costs, weak investment, and little sense of relief on the horizon.
The employer NICs [National Insurance contributions] increase has been the most widely cited source of pressure, hitting investment and pushing up prices. The proportion of businesses expecting to raise prices remains worryingly high, driven primarily by labour costs. Inflation now sits alongside taxation as a top concern. The global shift towards protectionism and tariffs has also been a major compounding factor.
Persistent weak sentiment this quarter may suggest that many firms have already priced in a tough Budget. But further surprise measures that hit business, like those seen in 2024, could drive confidence even lower.
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