CASHFLOW is still seen as a major problem for Liverpool firms – and could delay a return to pre-recession business levels until 2012.

The latest Liverpool Chamber of Commerce quarterly economic survey contends that the region is “bouncing along the bottom” of the economic cycle, with no clear evidence the economy has begun to recover.

It reveals the greatest concern for business is cashflow, with 44% of all businesses experiencing worsening cashflow in the last quarter, and, for many of these companies, cashflow has been an issue for the past six consecutive quarters.

Despite this, only 25% of businesses have recently applied for new bank facilities, with just over half of these companies getting a positive response.

Chamber chief executive Jack Stopforth said: “Clearly the contraction in the UK’s economy over the past three quarters has been steep and without precedent in recent decades.

“Merseyside has weathered this downturn far better than predicted.

“It’s now a question of how long the recovery will take. Even the most optimistic predictions suggest that it will be 2012 before output will match pre-recession levels.

“In the meantime, for many businesses, cashflow is the key issue.”

He added: “Good businesses, with proven track records and sound future plans should be able to look to their banks, to support them in respect of cashflow and credit facilities.

“This appears to be happening more, but I have continuing concerns that it is not happening quickly enough.”

The latest survey shows sales and orders are picking up for a growing number of service businesses and there are also signs of improvement in sales and in companies’ profit expectations.

However, overall, the companies who continue to see a reduction in sales and orders outnumber those who are seeing growth.

BILL GLEESON: PAGE 8