This latest edition for the three months ending 31 May 2009 shows 46% of firms surveyed reporting a decrease in turnover, 29% reporting static turnover and 25% reporting an increase, giving a net balance of -21%, a fractional improvement on the previous quarter's figure of -22%. However, an improvement in all the indicators looking six months ahead is evident.
Service businesses show the most obvious signs of improvement, with services reporting a net balance on turnover of -19%, as opposed to a figure of -23% in the last quarter. Volumes of both new and repeat business have improved. Production businesses showed a continued decline in turnover with a net balance of -26%. This is a significant drop from a figure of -18% in the last quarter.
Expectations of increasing turnover in the next six months have improved but remain negative for the fourth consecutive quarter. The overall balance for turnover for the next six months stands at -10%, a marked improvement on the -28% of the previous quarter and -44% of quarter before that. Concern about cost pressures weakened with a net balance of +27% indicating that while costs continue to rise, the overall level is well down on the +75% of the same quarter one year ago.
Both production and service businesses have indicated that the importance of weakening demand has reduced. If expectations are realised and continue to improve, a return to economic growth is possible by the end of 2009.
