Download Monthly Business Dashboard – October 2011

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Monthly Business Dashboard – October 20151
Hampshire County Council Area

– shows that Confidence (consumer and business confidence) drives the
level of Business Activity (output, the volume of new orders/future output and
employment in private sector). This in turn impacts on Labour Market performance and
Costs/Prices, which in turn impact on confidence.
DOTTED LINE
CONFIDENCE – the green bars indicate that Business Confidence in the South East
and the UK increased at the beginning of the third quarter. The business confidence
index in the South East increased from 14.6 in Q2 2015 to 26.4 in Q3 2015. 2 The
increase in business sentiment in the South East was faster than the UK average (dark
green bar).
Business sentiment in the South East was after the North West the highest in the
country. Across the country the highest levels of business confidence were found in
property, IT & telecoms and construction. Business sentiment was relatively subdued in
retail, distribution, hotels & catering and manufacturing.
Business sentiment in the South East remains robust compared to historic averages
(green area).
New Capital Investment intentions in the South East increased in the three months
to May 2014 (green bar). In the South East 30% of businesses (weighted by
employment) expected to make investment in new capital between March and May
compared to 27% reported in the previous period. In England the proportion of
businesses that expected to make new capital investment edged higher from 28% to
29% (amber bar). The red area indicates broadly subdued levels of new capital
investment intentions in the South East.
Consumer Confidence in the UK decreased four points last month (red bar). The
UK index that measures a range of consumer attitudes decreased from +7 in August to
+3 in September. All of the five measures used to calculate the index saw decreases last
month. The index that measures changes in personal finances over the next 12 month
decreased by one point to +6 but the index was still five points higher than at the same
time last year. Expectations for the general economic situation over the next 12 months
decreased five points to -2 which is six points lower than at the same time last year.
Major purchases index decreased by three points to +14 compared to 0 at the same time
last year. Savings index (which is not used in calculating the index score) increased by
one point to +3 compared to -9 in September last year.
The overall index of consumer sentiment remained robust compared to the historic
average (green area).

BUSINESS ACTIVITY or Output growth at private sector firms in the South East
increased in September but the level of business activity reached a 29-month low
last month. A seasonally adjusted index of business activity in the South East reached
53.8 in September compared to 55.8 in August (50.0 separates growth from contraction).
For further information about Hampshire see Quarterly Business Dashboard – Hampshire (2014 Q1).
Net balance: determined by subtracting the percentage of companies reporting decreases in a factor from the
percentage of companies reporting increases.
1
2
Economic & Business Intelligence Service, Research & Intelligence, Hampshire County Council. For further
information contact [email protected]
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The UK index eased from 55.2 in August to 53.3 in September. Both the South East and
the UK indices dropped to their 29-month lows last month. Growth in business activity in
the South East last month was again slower than in London and East of England but
ahead of the South West.
The PMI readings for September point to GDP growth of around 0.3% in the UK and
about 0.35% in the South East. Growth in business activity in both the UK and the South
East has eased since July with the average PMI reading pointing to GDP growth of
around 0.5% in Q3 2015 in the UK and the South East.
Slower growth in Q3 than in the previous quarter is corroborated by the
preliminary estimate of GDP growth from the UK Office for National Statistics
(ONS). According to ONS economic growth in the UK has eased from 0.7% in the
second quarter to 0.5% in the third quarter. The latest preliminary estimate shows that
economic growth was driven by services.
Services expanded by 0.7% on the quarter led by several broad sectors with significant
concentration in this part of the South East. Transport, storage & communication
expanded by 1.3%, output growth in business services and finance was 1% and
distribution, hotels & restaurants expanded by 0.8% on the quarter.
Production output increased by 0.3% but within this broad sector manufacturing fell by
0.3%. Agriculture expanded by 0.5% but construction output decreased by 2.2%
according to ONS.
The volume of New Orders (a leading indicator of short-term growth) in the South East
increased at a relatively strong pace compared to the long-run series average.
Service providers continued to perform better than manufacturing firms. According to
Markit anecdotal evidence suggests that improved demand in the South East contributed
to the increase in new orders in August.
Employment growth in the South East increased in August but at a slower pace
than in the previous month. The rate of job creation in the South East slowed to 52.7 in
August matching the UK average. The number of people placed in permanent jobs in the
South of England (excluding London) continued to increase in September according to
the latest KPMG/REC survey. The rate of growth was slower than in August, similar to
the UK average and the weakest since March 2013

LABOUR MARKET – the amber bars indicate that the claimant count Unemployment
rates in the Hampshire County Council Area and the UK remained unchanged in
September. The claimant count unemployment rate not adjusted for seasonal factors in
Hampshire remained unchanged at 0.7% in September, the lowest rate on record (since
comparable records began in 1992).
The claimant count rate decreased in Buckinghamshire and remained unchanged in all
other counties in the South East last month. The amber area points to unchanged
unemployment rate in Hampshire in September compared to June 2015.3
3
For further information see Labour Market Update – Hampshire (October 2015)
Economic & Business Intelligence Service, Research & Intelligence, Hampshire County Council. For further
information contact [email protected]
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As indicated by the amber bar the claimant count Youth Unemployment rate (16-24
year olds) in the Hampshire County Council Area remained unchanged in
September. Claimant count youth unemployment rate in the UK decreased last month
compared to the previous month (green bar). The claimant count youth unemployment
rate in Hampshire remained unchanged at 1.0% in September but the UK rate fell from
2% in August to 1.9% last month.
The claimant count rate decreased in East Sussex, edged higher in Berkshire and
remained unchanged in all other counties in the South East last month. The red area
points to a higher youth unemployment rate in Hampshire in September than in June
2015.4
As indicated by the green bars the Employment rates in the Hampshire County
Council area and the UK increased in the most recent year for which data is
available compared to the previous year. In the year to June 2015 compared to the
previous year (year to June 2014) the number of people in employment in the Hampshire
County Council area increased by about 25,700 and the rate increased by 2.9
percentage points to 81.4%, the highest rate on record. Employment growth in
Hampshire in the year to June 2015 compared to the previous year was the sharpest
in the South East and faster than the UK average (dark green bar). The rates fell in
East and West Sussex, Kent and Oxfordshire.
The size of the bar shows that at 81.4% the employment rate in Hampshire was well
above the UK average (72.9%) and now the highest rate on record and the highest rate
in the South East. The green area points to a higher employment rate in Hampshire in
the year to June 2015 compared to the year to June 2013.
The most recent (residence based) employment data for the Hampshire County Council
Area points to an exceptionally strong growth in the employment rate in the year to June
2015 compared to the previous year. However, the most recent official workplace-based
data points to a sluggish growth in jobs in Hampshire last year. Nevertheless, jobs
growth was exceptionally strong in Solent and Enterprise M3 last year which in turn
supported growth in the employment rate in Hampshire.5

PRICES/COSTS – growth in house prices in the Hampshire County Council Area in
September was faster than in the previous month but slower than at the same time
last year (red bars). Annual growth in house prices in England & Wales in September
was faster than at the same time last year (green bars).
Volatile monthly data shows that house prices in the Hampshire County Council Area on
average increased by 0.7% in September compared to 0.5% in the previous month.
Monthly growth in house prices in England & Wales was 1.0% compared to 0.7% in the
previous month.
Annual growth in house prices in Hampshire eased from 7.6% in August to 7.1% in
September. The annual rate in England & Wales increased from 4.3% in August to 5.3%
4
Claimant count data is not adjusted for seasonal factors. For further information on youth unemployment and
youth unemployment on the broader survey-based measure see Labour Market Update – Hampshire (October
2015)
5 For county level workplace-based data see Economy & Business Snapshot – September 2015 and for the
LEP-level data see Economy & Business Snapshot – October 2015 (forthcoming).
Economic & Business Intelligence Service, Research & Intelligence, Hampshire County Council. For further
information contact [email protected]
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in September.6 House price inflation in Hampshire has eased to within the range where
the rate is expected to be 99% of the time over the long-run (amber area).
Instead of just looking at the latest increases in house prices relative to historic averages
it is equally important to view house price increases in the context of several other
economic indicators that remain well below their historic averages – CPI inflation turned
negative in September compared to the same time last year, growth in average earnings
(excluding bonuses) was 2.8% in the three months to August compared to the same time
last year and the Bank of England continues to maintain its ultra-low monetary policy –
the official interest rate remains anchored at just 0.5%, with little prospect of an early rise
in the rate.
The average price of a property in Hampshire was about £244,900 in September or
about 31% above the average for England & Wales (£186,600) according to the Land
Registry data. The average price of a property in Hampshire in September stood at
around 8.7% above the pre-recession peak.
House prices in Surrey, Oxfordshire and West Sussex are some 22.9%, 18.5% and 9.9%
above their pre-recession peaks respectively. In London the average price of a property
in September was around £500,000 or about 42.6% above the pre-recession peak.
House prices in London jumped by about 1.8% in September and on an annual basis
growth has increased sharply, from 6.2% in August to 9.6% in September.
Input (factory) price inflation in the South East and the UK increased last month
(red bars). Factory prices in the South East increased at a faster pace than in the UK in
August but the rate eased from July and was weak compared to the long-run survey
average according to Markit.
The average output prices (prices charged for goods and services) remained broadly
unchanged in August according to PMI data.
The rate of inflation in the South East remains weak in the context of historic survey data
(green area).
The Consumer Price Inflation (CPI) was -0.1% in September compared to 0% in the
previous month (green bar). The largest downward contribution to the CPI last month
came from falling fuel prices and a slower growth in clothing and footwear prices in
September compared to September last year.
Inflationary pressures in the economy remain heavily subdued with core inflation
(inflation excluding food and fuel prices) at just 1% in September. With deflation in the
food and fuel categories there is little prospect of a faster growth in inflation over the
short-horizon.
Inflationary pressures in the economy remain heavily subdued with CPI inflation well
below the Bank of England 2.0% target (green area).
The latest official data on economic growth from ONS and survey-based evidence
suggest that the recovery in the UK has lost a bit of steam in the third quarter. Weaker
6
There is a time-lag between the sale of a property and the subsequent registration of this information with Land
Registry. As new information becomes available, the published price indices are revised to reflect any new data.
Economic & Business Intelligence Service, Research & Intelligence, Hampshire County Council. For further
information contact [email protected]
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global demand from both developed and emerging markets implies that the expansion in
the UK continues to be driven by domestic demand. The good news is found in strong
growth in several service sectors which are heavily concentrated in Hampshire. Subdued
inflation and growth in real wages will continue to support economic growth in Hampshire
and the UK over short-term.
Next Publication Date:
Monthly Business Dashboard: 27 November 2015
Economic & Business Intelligence Service, Research & Intelligence, Hampshire County Council. For further
information contact [email protected]