More optimism among business leaders at end of second quarter

Tuesday 20 July 2021

Business leaders in Jersey expressed more positivity in the latest quarterly survey of their opinions on the local economy.

At the end of the second quarter in June, the all-sector business activity indicator was moderately positive, at +20 percentage points. This means the proportion of businesses that reported an increase was 20 points higher than those that reported a decrease.

Breaking this down, the business activity indicator was strongly positive for the finance sector (+43 pp) and was moderately positive for the non-finance sector (+11 pp).

The business activity indicator for finance was significantly higher than in March, and was the highest balance recorded since June 2014.

Pictured: The business activity indicator for finance was the highest balance recorded since June 2014.

The non-finance sector also saw a strong quarterly increase of 36 pp and was the highest recorded balance since September 2018.

With regards to covid, the turnover indicator was moderately positive at +10 pp, which shows a strong improvement of 31 pp compared to the previous quarter.

The actively working indicator was essentially neutral at -8 pp which was unchanged from the previous quarter.

In the last three months, 53% of businesses had taken some additional workforce measures in response to covid, but the most cited measure in this quarter was recruiting staff rather than accessing the Co-Funded Payroll Scheme.

Looking over the next quarter to September, the outlook for future business activity was strongly positive (+29 pp) overall, with the indicator balance being strongly positive for both finance (+38 pp) and non-finance (+25 pp),

The overall future employment outlook was also strongly positive (+32 pp), with the indicator being strongly positive for finance (+49pp) and moderately positive for non-finance (+21 pp).

Looking specifically at the finance industry for the rest of the year, the employment expectations indicator for 2021 was strongly positive (+30 pp), while the profit expectations indicator for 2021 was extremely positive (+63 pp); 74% of finance companies anticipated an increase in profits in 2021, compared to 11% that anticipated a decrease; showing a strongly positive turnaround from the previous two quarters.

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