East Midlands business confidence highest in the UK

Companies in the East Midlands report higher confidence in their business prospects, which rose 15 points to 20%, and higher economic optimism, which increased by seven points to 9%. Together, this gives an overall confidence of 15%.

Businesses’ hiring intentions showed a net balance of 26% of businesses in the region expect to hire more staff during the next year, up 20 points on last month.

Across the UK, overall confidence rose one point to 2% as firms’ confidence in their own prospects climbed five points to 13%.

The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.

Amanda Dorel, regional director for East Midlands at Lloyds Bank Commercial Banking, said: “It’s encouraging to see that business confidence in the East Midlands is the highest in the country, with local firms continuing to demonstrate ambitions for growth.

“Their growing hiring intentions also show that East Midlands businesses are preparing for upcoming opportunities to develop and invest in growth, which will help boost the local economy.

“As they do, we will continue to be by their side. We have pledged £1.3 billion to support businesses in the Midlands throughout 2019 to help make this possible.”

Across the region, a net balance of 25% of businesses said they felt that the UK’s exit from the European Union was having a negative impact on their expectations for business activity, up 24 points on a month ago.

National overview

Outside the East Midlands, firms in the West Midlands and Yorkshire showed the most confidence, both on 7%, followed by the South East (6%).

Those in Scotland were the least confident, with an overall confidence of -18%, 20 points below the national average.

Overall confidence remained the weakest in the manufacturing sector, where it fell by five points to -2%, and the services sector, which remained unchanged at -3%. Overall business confidence in the retail sector rose by eight points to 14%, but fell two points in the construction sector to 10%.

“While overall business confidence this month has remained broadly steady across the UK, optimism in the economy has fallen, and both remain significantly below the same period last year, and the historic average. This month we are also seeing firms’ concerns about leaving the EU intensify against the backdrop of ongoing economic uncertainty.”

Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking

This article was originally written for East Midlands Business Link and can be viewed here.