It’s fair to say the period leading up to the General Election in December 2019 was on the whole pretty negative.
The three and half years of uncertainty over Brexit was taking it’s toll, with most surveys showing little or no growth in the economy and business confidence fairly low.
Indeed, the FSB’s Small Business Index stood at -21.6 in Q4 2019, an unprecedented sixth straight negative reading and the lowest quarterly figure since the same period in 2011 when the UK was midway through that recession. The Office for National Statistics showed UK GDP growth at a pretty flat 1.1% to Q3 2019 when compared to the same quarter a year ago. The underlying pace of growth in the housing market had slowed throughout the year as a result of weaker global growth and intensification of Brexit uncertainty.
So how has the result of the Election affected things?
In theory, a sizeable majority for the Conservative Party is a good thing for UK SMEs who can look forward to five years of relative stability. Certainly there is anecdotal evidence to suggest the result has been well received. Bookings of luxury holidays jumped immediately after 13th December; annual house price growth rose to a 14 month high of 1.9% in January 2020; an architect friend of mine reported twenty one new enquires in the first three weeks of January 2020 compared with only three in December 2019.
Of course, it’s very early days for the new Government and as far as Brexit is concerned there remains much to do. Leaving the EU on the 31st January 2020 was only the end of the beginning – the trade negotiations are likely to be every bit as painful and protracted as the withdrawal agreement, with the prospect of a hard Brexit at the end of 2020 still a possibility.
However, let’s take the optimism following the Election as a positive indicator and look forward to an improved year for the office furniture and fit-out industry in 2020. Interest rates are going to remain at historic lows for the foreseeable future, and the availability of credit continues to be strong with plenty of willing lenders in the market. Now is a particularly good time to be borrowing money to fund all those projects held back over the last three and half years!