BCC Quarterly Economic Survey Q4 2022 

The BCC’s Quarterly Economic Survey (QES) for Q4 2022 shows key economic indicators have stabilised at concerningly low levels, following significant declines in Q3.

The survey of over 5,600 firms – 92% of whom are SMEs – reveals business confidence, conditions and sales have stabilised at low levels, while inflation remains the top external factor of concern.

The research took place between November 7 and November 30, across the period the Government’s Autumn Statement was announced.

  • After significant declines across all business conditions tracked by the BCC in Q3, most indicators have stabilised at a low level.
  • Profitability confidence remains at Covid-crisis levels; only one in three (34%) businesses believe their profits will increase over the coming year, while more (36%) expect a decline.
  • Just 33% of firms experienced an increase in sales over the past three months, while 25% of firms reported a decrease, with hospitality firms the least likely to report improvements.
  • More firms are reporting taxation (38%) and interest rates (43%) as growing business concerns.

Business activity not experiencing any bounce back from significant fall in Q3.

The percentage of firms reporting increased domestic sales has stabilised at the low level reported in Q3. Only 33% of firms experienced an increase in sales over the past three months, while 25% of firms reported a decrease in sales and42% report no change.

More firms continued to report decreased cash flow versus increased cash flow. Only 24% of business said their cash flow has increased over the last three months, while 30% have seen it decrease.

Business confidence remains at Covid-crisis levels.

After business confidence plummeted in Q3, firms continued to report a negative outlook for the future in Q4. Less than half (44%) of firms expect their turnover to increase over the next 12 months, while 25% expect a decrease. Those expecting turnover to increase remains ten percentage points down from a level of 54% in Q2 2022. 

Profitability confidence remains much weaker than turnover confidence and has stabilised at Covid-crisis levels. Only one in three (34%) businesses believe their profits will increase over the coming year, while 36% now expect a decrease.

Little sign of plans to increase business investment.

Increases to business investment remain low. Only 21% of firms reported an increase to plant/equipment investment over the past three months, while 57% reported no change, and 22% reported a decrease.

Inflationary pressures remain top business concern

The percentage of firms expecting their prices to rise over the coming months (60%) remains near record highs but is showing slight signs of easing, down from 62% in Q3.

Concern about inflation also remains at record highs; 80% of firms cited inflation as a growing worry to their business. But there are also significant jumps in the percentage of firms concerned about taxation (38%) and interest rates (43%).

Check out the BCC Quarterly Economic Survey Infosheet