Sara’s Blog: Latest inflation figures, interest rate rise and ANOTHER award

As I struggle to recover from my first cold for two years, I realise how lacking in resilience (and badly stocked with cold cures) I have become. The fear of Covid-19 in all its variants is still very much with us and rightly has made us all much more conscious of infections and making sure that we are really recovered before going back to work. The worry is that, as the seemingly faster spreading but maybe milder Omicron spreads, we will have many people off work in the new year which can damage businesses – but no-one should be put everyone will need enough time to recover. It is going to be a challenging time – again – for business leaders and their teams.

So, please encourage everyone to get vaccinated and boosted. One local business is giving people the time off to go during working hours, however long the queueing is taking, and another company, worried about the lack of take up in their workforce, is giving everyone a day off on proof of being boosted. I am always interested in how businesses deal with such issues and so if you have any tips to share, please post below.

The other issues facing our economy continue. The statistics for November 2021 published by the Office for National Statistics (ONS) on Wednesday confirm that the surge in inflation continued unabated in November with the cost of living rising by a whopping 5.1 per cent in the 12 months to November, up from 4.2 per cent the month before, and its highest level since September 2011.

The Bank of England has raised interest rates for the first time in more than three years, in response to calls to tackle surging price rises. The increase to 0.25% from 0.1% came despite fears that the Omicron variant of Covid could slow the UK economy by causing rising inflation leading to people spending less.
The inflation figures largely reflected higher fuel prices and strong base effects which pushed up clothing and footwear prices in comparison with November 2020. Stronger growth in producer prices points to an acceleration of cost pressures in supply chains, indicating that inflation will unfortunately drift higher over the coming months. However, many surveys have recently stated that businesses are trying to absorb many of these costs.

It is concerning that inflation is outpacing wages and if this disparity continues to increase as we predict, real household incomes will be squeezed further, dampening consumer spending, and weakening overall economic activity.

Inflationary pressures are expected to intensify in the near term as the rising cost of imported raw materials, higher energy prices and the reversal of the VAT reduction for hospitality and tourism drives inflation materially higher by the middle of 2022. The hospitality sector is being hard hit again by Omicron and so the British Chambers of Commerce are advocating hard – in public and in private to Government – that the VAT rate (at the very least) is kept at 5%, and that furlough is again an option for businesses hardest hit.

We need to hear and understand the Government’s plan for supporting businesses through Plan B – and hope there isn’t a need for a Plan C.

Defence Employer Recognition Scheme Gold Award

On a much cheerier note, I am pleased to report that Staffordshire Chambers of Commerce is one of 15 organisations in the region to be awarded the Defence Employer Recognition Scheme (ERS) Gold Award from the West Midlands Reserve Forces & Cadet Association (WMRFCA).

The ERS Gold Award is given to organisations that proactively advocate and support defence, communicating their commitment both internally to employees and externally to the wider community through established policies and examples of support.

We at the Chambers believe that the armed forces are integral to the work we do and integral to Staffordshire and we are all extremely proud of this recognition of our support.

It is part of our constitution that there is a place on our Council for the Armed Forces and I know that many local employers and employees play a vital role in their support of our reserve forces.

We have our very own ex – Honorary Colonel of the British Army in past Chambers’ President, Mike Frewer, who represents the Armed Forces on the Chambers’ Council. We are also extremely proud to have WMRFCA as patrons reinforcing a strong partnership spanning many years.

Recruiting well-trained, work-ready talent is a growing challenge for many businesses. With employers looking for skilled staff with the right attitude and attributes to support their growing businesses, every year in the West Midlands, veterans are leaving the Forces with exactly this mix.

And we certainly won’t be resting on our laurels and will continue to utilise our connections and communication channels reaching out to employers to reinforce this message.

To find out more about the Employer Recognition scheme and how your business can benefit from supporting the armed forces community visit: www.wmrfca.org/employers

If you want to talk to us about any business issues, including funding, you can call our switchboard on 01782 202222 or call the Stoke and Staffs Growth Hub Helpline on 0300 111 8002 or email: info@staffordshirechambers.co.uk

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