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Business news

This month (April 2024) we have updates on the following topics:

  • General economic outlook
  • The Spring Budget
  • Challenges faced by businesses
  • Skills in demand in our region
  • Labour markets

General outlook:

  • Inflation remained at the forefront of discussions regarding the economy throughout the March period, as well as the fact that the economy fell into a recession at the end of 2023
  • Speaking to the BBC, the Bank of England indicated that with inflation dropping to 3.4% in February that it may now be possible to drop interest rates, which have been held at 5.25% by the Bank. Though currently inflation sits above the 2% target set by the Bank of England, Governor Andrew Bailey said: "We don't have to actually get inflation all the way back to target…to cut rates for instance, what we have to do is be convinced that it is going there."
  • According to the ONS, the drop in inflation through February 2024 means that the cost of living is now rising at the slowest pace since September 2021. The fall was driven by food and non-alcoholic drinks, cafes and restaurant prices, as well as easing alcohol, tobacco, clothing, and footwear prices. 

The Spring Budget:

  • This is the final budget from the UK government prior to the next General Election and included some positive changes for businesses. The Chancellor labelled it the "budget for long-term growth", hoping that cuts to the National Insurance rate, freezing of fuel and alcohol duties, investment in key industries, and an increase of the VAT threshold would boost a sluggish economy
  • In a boost for small and medium-sized enterprises (SMEs), Mr Hunt announced a rise in the threshold for VAT registration from £85,000 to £90,000 from April 1, which he said would "pull tens of thousands of businesses out of paying VAT altogether"
  • Following calls from business lobbying groups, Mr Hunt announced that the full expensing relief for capital investments he announced in his autumn statement will be extended to leased assets "as soon as it’s affordable". This is likely to encourage further investment in the manufacturing, agriculture, and construction sectors
  • A more detailed look at what the budget means for businesses in the UK can be found on Natwest's website.

Main challenges faced by businesses:

  1. Economic uncertainty
  2. Cost of materials
  3. Competition with other businesses
  4. Insufficient domestic demand

Skills most in demand in our region in March 2024 were:

  1. Auditing
  2. Warehousing
  3. Nursing
  4. Learning strategies
  5. Machinery

Labour markets:

Ashfield's February 2024 figures show that we have 4% or 3105 people of working age seeking work. This is higher than in January 2024, which had 3005 people searching for work.