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South West business confidence bounces back

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Written by: Olivia Alexandra Scull | Posted 05 December 2018 13:11

South West business confidence bounces back

Business confidence in the South West of England bounced back in November, according to the latest Business Barometer from Lloyds Bank Commercial Banking.

Overall confidence rose 18 points to 20 per cent in November, almost eliminating October’s fall of 22 points and ensuring the underlying picture – measured by the average over the past three months – shows overall confidence at 15 per cent.

Companies in the South West now report higher confidence in their business prospects, which rose 10 points to 25 per cent.

And a net balance of 16 per cent of firms said they were optimistic about the economy, compared with last month, when a net balance of 12 per cent said they were pessimistic.

A net balance of 21 per cent of businesses in the region expect to hire more staff during the next year, up 10 points on last month.

Meanwhile, a net balance of 13 per cent 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, compared with 27 per cent a month ago.

Across the UK, overall confidence bounced back, climbing five points to 24 per cent as firms’ optimism about the economy rose nine points to 17 per cent. Companies’ confidence in their own business prospects rose two points to 31 per cent.

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

Adam Rainey, regional director for the South West at Lloyds Bank Commercial Banking, said: “A much more positive picture has been painted by South West businesses during November, driven largely by greater optimism in the outlook for the UK economy.

“Firms will be hoping that they will soon be able to plan with greater certainty and are looking to create new jobs to take on whatever challenges and opportunities the New Year may bring.”

National picture

Businesses in Yorkshire showed the most confidence, at 43 per cent, ahead of the West Midlands (39 per cent) and London (34 per cent).

Those in the East Midlands were the least confident, with an overall confidence of 10 per cent, 14 points below the national average.

Sectors

Firms in the manufacturing sector saw the largest increase overall, rising by 11 points to 32 per cent, while construction also registered a significant improvement of seven points to 29 per cent.

Retail confidence edged up by one point to 30 per cent, while other services rose five points but still continued to lag behind other sectors at 20 per cent.

Concerns about the impact of leaving the EU were the highest in manufacturing and other services

Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking commented: “Following last month’s dip, with business confidence reaching its lowest level since August 2017, it is reassuring to see that business confidence has picked up, helped by stronger economic optimism and hopes of a Brexit deal.”


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