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Transport contracts, like any other work opportunities, are affected by the background state of the overall economy. So, what is currently happening in the UK and what’s the prognosis? 2013 – Another year of uncertainty At the time of writing, all the present economic indicators appear to suggest that 2013 is likely to be, broadly speaking, another flat year in terms of economic performance. Although the economy appears to have got through the catastrophic years of 2008-2010, over the three years since there appears to have been very little positive indication of a consistent improvement in the position and the outlook for significant economic growth. In fact, some economists were holding their breath to see if the economy would slip back into a triple-dip recession during the first quarter of the year, but fortunately that was avoided – if only just. The position appears to be just as poor, if not slightly worse, in much of the Eurozone, with the possible exception of Germany. While that continues to be the case, the resurgence of demand for British goods in Europe would appear to be unlikely. In the Far East, things appear to be sluggish in most of the major economies and even the once apparently unstoppable Chinese performance seems to be faltering. If there is one global glimmer of hope at the moment, it comes from the USA, where job creation, growth and stock market price increases appear once again to be moving forward into promising territories. Transports specifics The fuel duty escalator now appears to be a concept that is virtually dead and, over recent times, the cost of fuel has, in some areas, fallen. That is good news for people working in the area of transport contracts, and some companies may also welcome corporate taxation changes that arrived with the spring budget. If that is perhaps good news, it may be tempered somewhat by the realisation that the transport industry exists to serve other industries and if their confidence remains low and demand for their products likewise, it will inevitably have a consequential impact on opportunities for those who take on transport contracts. Although some business confidence surveys have shown an encouraging increase in optimism amongst certain captains of industry, other surveys have shown that consumer demand remains relatively low and consumer confidence likewise. As has been commonly mentioned since 2011 and 2012, consumer consumption is at the very heart of our economic model, and if confidence doesn’t exist there, the overall economy is likely to continue to at best adrift and at worst stagnate. Forward looking We are now only somewhere between 2 and 2½ years away from the next general election. The government will be desperately keen to see some recognisable improvement in the economy, people’s confidence and ultimately the disposable income they have in their pockets, long before those same people need to go to the ballot box. At the moment though, a number of respected international institutions, and indeed the government’s own statisticians, are suggesting very modest growth figures for the year or two ahead. While it isn’t immediately clear just what more in the government could do to get the economy moving, as the election date draws ever-closer, it might be safe to anticipate another flurry of economy-stimulating activities. Just what these will be and how they might affect transport contracts specifically, we will wait to see. Norman Dulwich is a Correspondent for Haulage Exchange, the leading online trade network for the road transport industry across the UK and Europe. It provides services for matching transport contracts opportunities and to buy and sell road transport and haulage work in the domestic and international markets.
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