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Export growth is a priority and government must play its part, says report

The research reveals an improvement in financial performance for the region over the past 12 months.

The index shows that business sentiment has stabilised over the last year but also shows that:

  • Gross profits increased by 6.1% over the last 12 months, a significant increase from the 2.5% rise in Q2 2014.
  • Firms expect to grow their staff numbers by a further 2.6% in the year ahead.
  • Businesses in the region hindered by late payments has more than halved to 7%.
  • While financial performance has improved, goods exports from the East of England to the EU fell by 12% – a worrying sign.

Kevin Gale (pictured), practice leader at Grant Thornton’s Milton Keynes office, said: “The good news, along with stabilising confidence, is the growth in profits, indicating that the consolidation and investment we have seen across the region’s businesses is starting to pay off.

“This is underlined by the results of the 2015 Bedfordshire Limited study which shows a very healthy increase in profit before tax for the county’s 100 largest companies combined.

“Equally pleasing is that with employment expected to rise over the next 12 months, the appetite for investment appears to remain. However, with uncertainty around the new government’s attitude to business and the possibility of an EU referendum, many companies may adopt a ‘wait and see’ approach.”

ICAEW East of England regional director Phillippa Bourne added: “It is reassuring that businesses in the region have remained confident in the face of growing political and economic uncertainty. However the new government now has an opportunity to hit the ground running to get the UK economy moving forward again.

“A big priority should be to grow our exports, as our economy is growing increasingly unbalanced and reliant on domestic demand. While growth built on domestic demand is fine for the moment, soon the benefits of low inflation and cheaper petrol will evaporate.

“It is crucial that we look to boost our exports both inside and outside the EU. Businesses need to think global from the start, and we need to make it easier for them to trade internationally.”

Mr Gale said: “What our region’s businesses need is support from the government – and fast – to speed up the pace of growth and help them expand into overseas markets. Only this will provide the balanced, sustainable recovery the country needs.”