A further slowdown in the Lancashire economy in the later part of the year is expected in the latest Quarterly Economic Survey from the Chambers of Commerce.
The Q4 survey, compiled by the county’s Chambers of Commerce in association with MHA Moore and Smalley Chartered Accountants and Business Advisors, shows that sales at home and abroad weakened compared to the previous quarter.
But manufacturing performance was still strong by historical standards.
In the service sector, the main driver of the economy, growth remains muted and is below historic averages.
The proportion of firms confident that turnover and profitability will improve in the next year decreased, and there was also a notable decline in the retrospective and forward looking employment balances.
Investment intentions were also down on the previous quarter.
The results also reveal that firms are still under considerable pressure to increase prices with 43 per cent of firms expecting to increase the price of their goods and services in the next three months.
Raw material costs and exchange rate fluctuations are of greatest concern to manufacturers, whilst overhead costs and inflation are having a greater impact on service businesses.
Alan Welsh, Policy Manager at the North & Western Lancashire Chamber, said: “The results of our fourth quarter survey are in tune with OBR forecasts for slow growth in the coming months.
“Household incomes and spending are being squeezed by higher inflation which is a major concern, especially for consumer-facing businesses.”
He added: “Whilst business confidence remains relatively high, some of the previous optimism that turnover and profitability will improve in the year ahead is beginning to evaporate ”