Business confidence in South West soars according to new research

Business confidence in the South West soared over the last month according to a new survey.

The research from Lloyds Commercial Banking said confidence rose by 36 per cent in April.

Companies in the region reported higher confidence in their own business prospects month-on-month.

And South West businesses identified their top target areas for growth in the next six months as investing in their teams, evolving product or service offerings, and diversifying into new markets.

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

A net balance of 32 per cent of businesses in the region expect staff levels to increase over the next year, up 14 points on last month.

With three Bank Holidays in May, firms’ optimism in the overall economy increased five points to 28 per cent – the highest reading since June last year.

Amanda Dorel, regional director for the South West at Lloyds Bank Commercial Banking, said: “Confidence amongst the region’s businesses is at its highest level for some time, and there is good reason for optimism as we look ahead to the summer months.

“As temperatures begin to rise, the region’s tourism and hospitality businesses will be hoping for an extended period of strong trade, especially as consumers take advantage of May’s three bank holidays. Making the most of these opportunities is key, and those who keep a close eye on their working capital will be best placed to take advantage of any increases in trade.”

Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said: “The recent increases in business confidence indicate that the economy entered the second quarter of 2023 with positive momentum.

“The revival in the demand for labour, which improved for the fifth consecutive month, may account for the modest uptick in wage expectations for the next twelve months.

“While firms’ concerns on overall cost pressures have eased, there is little evidence that pricing expectations have declined which may impact wider pricing decisions for the remainder of 2023.”