Firms are gearing up for a wave of new investments, a North East business survey has suggested.
Across the region companies have said they are preparing to start spending on growth projects put on hold from the recession.
The survey has suggested firms are likely to start hiring after five years of sluggish growth, with hopes of the private sector finally tackling the North East’s UK-high unemployment rate.
The North East Chamber of Commerce survey comes as the Government announces it will hand over another £100m to Enterprise Zones.
While there is no indication as to how much the North East will get from the pot, the news has been welcomed.
Paul Woolston, chair of the North East Local Enterprise Partnership, said: “It’s great news that £100m of government funding for Enterprise Zone infrastructure works is being made available.
“The North East LEP’s Enterprise Zone offers once-in-a-lifetime opportunities to the region. It is one of the country’s largest EZs, with 110 hectares of land with benefits for investors.
“It was the first in the country to have a major development underway, and it has attracted companies and developers in automotive, offshore and energy-related sectors.”
Last night Chamber policy director Ross Smith, said: “It is great news to see results suggest that the regional bounceback from the economic downturn continues.
“It is heartening to see last quarter’s best set of results in five years backed up by another good period. The pattern of the scores is a little different this quarter with sales and orders growth slowing, but manufacturers continue to grow exports more quickly, while service businesses have shown stronger growth in domestic markets.
“Confidence is apparent in growth in investment plans, with scores at a six-year peak on the back of strong service sector investment.
“Plant and training investment growth over recent quarters has been caveated with a reminder that this is coming from a low base, but with four consecutive quarters of growth in plant investment, this seems to be becoming more significant.”
Brian Foreman, head of Barclays mid-corporate banking team, said: “Firms are much leaner after using the last few years to recalibrate. During that process, a lot of investment plans were mothballed.
“That left a lot of pent-up demand which is now starting to flow through.
“What is even more encouraging is that firms are also taking decisions on strategic investment in production lines, buildings or workforce, and some of these are quite bold.
“Sometimes where there is just a lot of pent up demand you get a sudden spike, but our pipeline is as strong as it has been for at least five years.”