Insider Media Limited

You read a lot of research in this job. Sometimes the surveys come so thick and fast that you could be forgiven for thinking that creating them must be the fastest growing industry in town.

But whilst some of them state the blindingly obvious, are out of date, partial or obscure, this week has seen the arrival of a number of pieces of research that provide crucial information on the regional economy.

First up was data obtained by Absolute Invoice Finance that showed lending to small businesses under the government-backed enterprise finance guarantee (EFG) loan scheme has continued to drop, with a further fall of 20 per cent in the last quarter.

Tony Smedley, the firm’s regional managing director in the Midlands, is absolutely right when he says: “SMEs need the government to act now to iron out the problems within the scheme and incentivise lenders to lend more through the EFG scheme.

“With so many SMEs being refused credit by the big banks the sheer scale of decline in lending through the EFG scheme is a big concern. SMEs must look towards dependable and alternative funding sources in order to maintain cashflow and prepare themselves for further volatility in the economy.”

The last bit of that quote demonstrates that Smedley - representing as he does an “alternative funding source” - isn’t an impartial observer in these matters. But that doesn’t make the underlying findings he refers to any the less worrying.

Better news came from Nottingham-based research company Experian, which revealed that business insolvencies are down 30 per cent year on year.

In the West Midlands some 136 companies failed in July compared to 228 in the same month in 2009. In the East Midlands there were 98 insolvencies compared to 170 in July 2009.

The figures are still high, of course, but things are clearly going in the right direction.

As Max Firth, managing principal of pH, an Experian company, said: “July’s data indicates that the SME population is faring much better in terms of insolvencies than it did this time last year, however, increasing failures at the top end of the market demonstrates clearly that there is a still a great deal of uncertainty.”

But that positive news was soon forgotten after research from property industry group RICS showed that construction work began to decline again in the second quarter of the year, as fears over the scale of public spending cuts and ongoing uncertainty about prospects for the economy hit the sector within the region.

Its survey showed that in light of cuts to budgets, public housing and other public works were the worst affected sectors and reflects that the large fall in the public works sector has been attributed to the suspension of the building schools for the future programme (BSF).

This construction news is especially worrying because this is where direct government action - abolishing the BSF programme - has had a negative impact on an already ailing sector.

The health of the construction industry - being as it is at the heart of so much that is about positive momentum and physical change - is a key barometer to the wider health of the economy.

My view is that the government is still showing far too much stick and nowhere near enough carrot. The construction sector needs support, not the removal of one its remaining lifelines.

Three surveys then, two negative and one positive. Probably a fair reflection on the economy at present. As Mr Babbage on Family Fortunes might say: uh-uhh.