East Midlands business confidence lowest in the UK, says bank

Businesses confidence in the East Midlands is now the lowest in the UK, according to the latest Business in Britain report from Lloyds Bank.

Confidence – calculated as an average of respondents’ expected sales, orders and profits over the next six months – has fallen 10 points to 14 per cent since January.

The net balance of firms looking to grow investment in the next six months has also fallen by 10 points since January to a net balance of zero per cent – meaning as many firms plan to reduce investment as plan to increase it.

And net balance of just one per cent of businesses now expect to hire more staff, a fall of nine points since the start of the year.

The share of firms that reported difficulties hiring skilled labour rose two points to 49 per cent.

Meanwhile, the net balance of businesses expecting to increase pay fell by 15 points to five per cent.

Glen Wilson, regional director for East Midlands at Lloyds Bank Commercial Banking, said: “It’s disappointing to see that confidence in the East Midlands has dropped and is now among the lowest in the UK, particularly after the high levels of confidence seen at the beginning of this year.

“There is no doubt that local businesses are facing some stiff challenges at the moment, with Brexit uncertainty and concerns over domestic demand highest among them. In light of this, it’s unsurprising that businesses have become more cautious, reducing their investment and recruitment plans accordingly.

“While there is a degree to which this may be prudent amid such uncertainty, businesses need to ensure they are not missing out on the opportunities being created amid the current turbulence.”