NW businesses show highest levels of confidence this year

Economic confidence is on the up

Business confidence in the North West rose 20 points during November to 54%, according to the latest Business Barometer from Lloyds Bank Commercial Banking -conducted between November 1-15, before the Chancellor’s Autumn Statement announcement on November 22.

Companies in the region reported higher confidence in their own business prospects month-on-month, up 17 points at 59%.

When taken alongside their optimism in the economy, up 22 points to 48%, this gives a headline confidence reading of 54%.

North West businesses identified their top target areas for growth in the next six months as introducing new technology (38%), entering new markets (34%) and evolving their offer (34%).

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

A net balance of 45% of businesses in the region expect to increase staff levels over the next year, up eight points on last month.

Nationally, overall UK business confidence rose three points in November from 39% to 42%, the third consecutive monthly increase, while firms’ outlook on the overall UK economy increased four points to 38%.

Businesses’ optimism in their own trading prospects also continued the upward trend for the second consecutive month, rising three points to 48%.

Companies’ hiring intentions reached their highest level since May 2022, with 35% of firms intending to increase staff levels over the next 12 months, up three points month-on-month.

Firms in London reported the highest level of business confidence, jumping nine points to 56% followed by the North West, Yorkshire and the Humber (50%) and the North East (48%).

Firms in the services industry reported an increase in confidence to 46% (up three points), the highest level for more than two years (since September 2021), reflecting broad based optimism in the sector.

Retail confidence also rose for a second month to 42% (up five points), while sentiment among manufacturing firms reached a five-month high of 45% (up nine points) in contrast with recent shortfalls. Construction firms’ confidence improved for the first time in three months to 35% (up four points), but this still lags other sectors.

Jenny France

Jenny France, area director for the North West at Lloyds Bank Commercial Banking, said: “Cities like Manchester and Liverpool will start to see a rise in footfall following the opening of the Christmas Markets.

“While increasing trade is brilliant, we recommend businesses stress test different scenarios and put plans in place to mitigate any issues. This could include reviewing cashflow or exploring working capital finance options to cover short term funding needs.”

The next survey in December will reveal how firms are digesting the measures announced in the Chancellor’s Autumn Statement.