Tuesday, February 16, 2010
A survey of business leaders from a spectrum of Isle of Man based companies - spanning manufacturing, professional services, e-business, shipping, aircraft and finance - reveals confidence levels on the Isle of Man remain strong despite wider economic uncertainty.
Two thirds (62%) of businesses have seen only a small reduction in turnover (0% – 10%) since the start of the global recession. 84% of firms polled expect to post a profit in the year ahead, compared to 70% of firms who were asked the same questions six months ago.
Looking ahead, more than two thirds (69%) of companies expect to grow over the next 12 months. Nearly one in five (18%) predict their firm will shrink over the next year although two in three of such businesses (12%) say they only expect to shrink “a little”. The most pertinent issue facing Isle of Man businesses is diversifying into new markets and products (33%).
Nearly half (46%) of firms do not see themselves taking any cost cutting measures over the next year. For those that need to reduce outgoings it appears the last 12 months has forced companies to focus on staff-related costs with travel and entertainment (32%) and salaries (25%) topping the list. The research also shows that research and development is still a priority as only 5% of firms look to cut back on spending in this area.
Minister for Trade and Industry, David Cretney, said: “It is encouraging to see that businesses on the Isle of Man remain positive about the outlook for the year ahead. The performance of our economy is holding up well: the Isle of Man has avoided recession and the latest figures are encouraging with National Income forecast to grow by 2.5% this year (and 4% next year), low unemployment (2.1%) and low inflation (1.3%).
“The Isle of Man government’s diversification strategy has provided some protection against the global economic downturn and we plan to continue this strategy over the next 12 months. In addition, close public and private sector cooperation and the ability to offer a range of financial incentives such as capital grants and loans to businesses has assisted in attracting businesses with innovative new ideas and we are confident economic growth on the Isle of Man will remain strong as the world economy emerges from recession.”
Concluding, Treasury Minister, Allan Bell, opined: “Because of the policy of diversification pursued by the Isle of Man government in recent times, the economy is now less reliant on any one sector or geographical area and this has helped to shield the economy from the worst of the current downturn. Indeed this policy will help to ensure that the Island’s economy fully recovers ahead of the majority of our competitors.”