Continuing uncertainty about Brexit has been damaging both the domestic and export sales of the capital’s businesses in the first quarter of 2019, according to the London Chamber of Commerce and Industry.
Findings from its latest quarterly survey of 500 of its members also show that business confidence indicators have fallen to their lowest level yet, with expectations for the London economy and the UK’s as a whole increasingly negative.
Domestic orders and domestic sales alike were down for more companies than they were up for the seventh consecutive quarter and the equivalent falls in export demand market the first time since the Chamber’s Capital 500 survey, conducted for it by ComRes, that both export figures have been negative.
There was an increase to 15 per cent in the proportion of companies seeking to recruit personnel compared with the previous quarter, but also a slightly larger rise, to 63 per cent, in the proportion encountering difficulties recruiting.
Skilled technical and manual roles were found to be the hardest to fill for the largest number of companies, followed by professional and managerial positions. There has also been a decrease in investment in plant and equipment.
Sean McKee, the Chamber’s director of policy and public affairs, said, “The figures for the first quarter of 2019 show the impact of Brexit uncertainty on London’s economy, with both domestic and export sales in negative territory.”
Highlighting companies’ recruitment difficulties, he added: “The importance of the right post-Brexit immigration system is abundantly clear, as is the need for certainty on the UK’s future trading relationship with the EU.”
Among recommendations from the Chamber to support London business are a greater devolution of powers to the capital, including over the use of taxes raised in London, and the start of an “ongoing dialogue” between businesses, national government and the London Mayor, with a view to encouraging exports.
There was also a warning that smaller businesses might find it difficult to upgrade to cleaner vehicles in time for the start of the Mayor’s Ultra Low Emission Zone in Central London next week and a call for “advisory” rather than “enforcement” notices to be served on vehicles that don’t comply with the new, higher air quality requirements in the early months.