Published: 10:30, 06 November 2017 |
Updated: 14:09, 07 November 2017
Investment in training and equipment were at record lows across Kent in the third quarter of the year.
The figures are blamed on uncertainty caused by the Brexit negotiations.
The proportion of companies set to increase spending on upskilling staff and new kit fell to an unprecedented 13% and 14% respectively.
Business sentiment in the county appears to be at odds with the performance of the economy in general, as figures from the Office for National Statistics show GDP grew by an unexpected 0.4% over the same period.
The findings by Kent Invicta Chamber of Commerce also show the number of firms in the county working at full capacity is at its highest on record in Kent at 46% in the third quarter of 2017.
Its quarterly economic survey said: “As firms have cut back capacity to adjust to their lowered business expectations, the proportion working at full capacity has been rising all this year.”
The proportion of company bosses saying cashflow had worsened was up one point to 26%.
However, the gradual improvement in companies reporting improved cashflow continued for the fifth straight quarter, reaching 30%.
Jo James, chief executive of Kent Invicta Chamber of Commerce, said: “Having looked at the trends since Q1, it does appear that the uncertainty around Brexit and the current economic climate is having an impact on investing in hiring and training staff or general business investment.
“One in four businesses are continuing to say that cashflow is getting worse, so we don’t have a cash rich economy and businesses are safeguarding what they have.”
The poll of 150 businesses in the county also found that growth in export sales prompted by the devaluation of the pound after the Brexit vote appears to be flattening out.
Some 63% of bosses reported overseas revenues had remained the same on the previous quarter, up 20 points.
This comes after a surge in those reporting increases in exports in the second quarter, which reached 33% compared to 17% in the first three months of the year.
There were 24% reporting an improvement in the third quarter.
The picture was mirrored on the export order book, with 70% saying this remained the same in the third quarter, up from 46%.
However, this was on the back of growing numbers saying export orders had worsened in the second quarter.
Meanwhile, half of firms expect their turnover to rise over the next year.
This is up one point on the second quarter and unchanged from a year earlier, although down from 66% in the first three months of the year.
Although the number expecting it to worsen fell six points from its record high of 25% to 19%, this is still higher than every other quarter since the third quarter of 2012.
Profit expectations were more cautious, with 48% expecting them to improve but 23% expecting them to worsen.
"Having looked at the trends since Q1, it does appear that the uncertainty around Brexit and the current economic climate is having an impact on investing in hiring and training staff or general business investment..." - Jo James, Kent Invicta Chamber of Commerce
Both, however, were improvements on the previous quarter.
Mrs James added: “The survey respondents aren’t so confident about future profits and turnover, but then again this is not surprising, as they are generally uncertain about what will transpire out of the Brexit negotiations and what a future business landscape will look like.”
Only 8% of Kent firms said their staff levels decreased in the third quarter of the year, down six points.
Those saying staff numbers increased grew four points to 26%, said a survey by Kent Invicta Chamber.
However, there was some caution about plans to hire people, with 25% saying they planned their staff levels to increase, the second-straight quarterly decline.
Meanwhile, 7% said they would lose staff, up two points.
More businesses in Kent reported an increase in UK sales in the third quarter – but many plan higher prices.
Some 41% said domestic revenues had grown, up five points and the best in more than a year, while 34% said UK forward orders had improved, up six points.
However, as inflation rises, 35% of Kent firms plan to increase prices, up three points.
The Consumer Prices Index, published by the Office for National Statistics, said the inflation rate was 2.8% in September, up from 2.7% in August.
It was last higher in March 2012.
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