Business News Round Up (23/12/2022)
UK’s economy shrinks more than previously thought in third quarter
The United Kingdom’s (UK) economy has contracted more than previously thought in the third quarter of this year, putting the country at the bottom of the G7 in terms of quarterly growth. According to data presented by the Office for National Statistics (ONS) on Thursday, the Gross Domestic Product (GDP) fell by 0.3% in the third quarter against the estimated 0.2% decline. Growth figures for the first half of this year were also revised down, with figures showing the country mustered growth of just 0.6% in the first quarter and 0.1% in the second quarter. The office also reported that the Gross Domestic Product (GDP) is now estimated to be 0.8% below pre-pandemic levels. Darren Morgan, director of economic statistics at the ONS, said the office’s revised figures showed that the UK’s economy performed slightly less well over the last year than previously estimated, with manufacturing and electricity generation notably weaker, according to a report by the Associated Press.
Late payment problems ease for North West firms
Late payment problems have eased for North West businesses, according to new figures. Research by the insolvency and restructuring trade body R3 shows the number of overdue invoices falling by 32.1 per cent last month. The number of invoices owned to businesses in the region which were past the payment deadline, after rising for six months in a row, fell from 830,465 in October to 563,531 in November. R3’s analysis of data provided by Creditsafe also shows the number of North West companies which were themselves behind with their bills decreased from 60,500 to 54,800 during the same period – a fall of 9.5 per cent. R3’s North West chair Allan Cadman, who is also an insolvency practitioner with Xeinadin Group, said the drop in late payments could be due to a number of reasons. “Since restrictions on issuing winding up orders expired in April, creditors have been actively pursuing debts and as cases work their way through the court process, we are seeing a big rise in the number of compulsory liquidations,” he said.
https://www.insidermedia.com/news/north-west/late-payment-problems-ease-for-north-west-firms
More than 75% of British companies admit the Brexit agreement has not improved their sales or business
Over three-quarters of British firms say the post-Brexit trade deal agreed between the EU has not helped boost their sales or expand, new research suggests. The British Chambers of Commerce has warned that the Trade and Co-operation Agreement (TCA) struck in December 2020 had left many companies struggling with extra red tape, particularly when it comes to exporting to Europe. More than half of businesses polled by the BCC said they had experienced problems adapting to the new rules related to the buying and selling of goods, while 45 per cent revealed difficulties with services trading. Of the 1,168 respondents surveyed, most of whom were small and medium-sized enterprises, only 5 per cent said they had seen their turnover increase or business grow, compared to 77 per cent who stated the opposite. Agri-food producers have been notably affected by the increase in bureaucracy because plant and animal-origin products going to the EU now require an export health certificate signed by a veterinarian.
Retrofitting offices will drive demand says agents
Retrofitting office buildings across Edinburgh will be a key trend next year, according to new data from commercial property agents. Year-end take-up is expected to hit 700,000 sq ft of which 80% has been focused on the city centre. This is 13% below the long-term average of 805,000 sq ft for the capital, according to JLL. Because of continued uncertainty, lack of sustainable products and limited choice, the number of existing leases that were renewed in 2022 reached a record high of more than 350,000 sq ft. When combined, the total transactional volumes in Edinburgh reflect an above average level of activity. Occupier demand was largely driven by firms “right-sizing” as employees return to the office following the final Covid-19 restrictions coming to an end in April. Occupancy levels rose from 38% at the end of 2021 to a high of 49% this month, with professional services firms seeing the highest occupancy levels and the technology sector experiencing the lowest. Due to the increasing demand for city centre offices, prime rents are now established at £40 per sq ft, which reflects a 5% increase over the past 12 months. JLL is expecting prime rents to rise above £40 per sq ft in 2023. It says that to help plug the supply gap, investors and developers need to consider refurbishing or retrofitting existing stock.