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Companies retain long-term confidence

By Nick Britton on August 07 2008

Half of all companies expect the business climate to deteriorate over the next 12 months, while only one in ten sees it improving. But in the longer term, companies remain confident, according to a survey conducted by Ipsos MORI on behalf of England’s Regional Development Agencies.

On balance, businesses intend to increase capital investment, spend more on training staff, and accelerate product and process development. The balance of businesses looking to invest more in these areas minus those intending to cut back is nine per cent, 13 per cent and 14 per cent respectively.

A majority of companies (54 per cent) have not diminished their workforce in the last 12 months, while a similar number (55 per cent) are confident their employment levels will remain the same over the next 12 months.

However, there has been pressure on profitability, with 45 per cent reporting lower profit margins compared with 15 per cent reporting higher margins. Nearly half (45 per cent) of companies have responded to the challenge of shrinking profits by raising prices, while just 11 per cent claim their prices are lower.

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