The Chief Executive of the East Midlands Chamber has commented on the latest ONS figures which show that UK GDP contracted by 0.3% between August and October 2022.
Scott Knowles said: “The macroeconomic picture reflects what we are hearing on the ground as businesses have had to negotiate a hugely challenging period.
“The convergence of cost pressures – including energy, interest rates, people, raw materials and fuel – has created a cost-of-doing-business crisis that has engulfed the economy for more than a year now.
“In the East Midlands, our research has illustrated a worsening picture throughout 2022 as global and local headwinds have impacted business activity and sentiment, with confidence about future prospects declining throughout most of the year.
“One of the most troubling findings has been a dramatic drop-off in business investment. Our upcoming Quarterly Economic Survey for Q4 2022 shows intentions to invest in plant and machinery, and in training people, dropped by 6% and 8% respectively compared to the previous three-month period.
“This stifles companies’ ability to raise productivity, which is integral to driving forward the economy again and ensuring the anticipated recession is as shallow and short-lived as possible.
“Our recent Business Manifesto for Growth, A Centre of Trading Excellence, provides a blueprint for how the Government can create a stable environment to allow firms to invest. We call this ‘getting the basics right’ by cultivating a wider business ecosystem geared around supporting success, with a focus on incentives to invest in people.
“We also want to see Government incentivising longer-term private sector investment at more generous levels, supporting greater levels of innovation via enhanced R&D packages and easier links into universities, long-term plans for improving infrastructure and reducing barriers to international trade.
“All this is key to restoring business confidence, improving our competitiveness as a trading nation and reversing the current trajectory of economic decline.”