Business confidence rises sharply in South West
Business confidence in the South West rose sharply over the last month, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies in the South West reported higher confidence in their own business prospects month-on-month.
South West businesses identified their top target areas for growth in the next six months as introducing new technology (31%), diversifying into new markets (30%) and investing in teams (29%).
The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide.
A net balance of 35% of businesses in the region expect to reduce staff levels over the next year, down three points on last month.
Overall UK business confidence increased to its highest level since February last year, jumping 10 points to 41% in August.
All 11 regions and nations reported a positive business confidence reading in August, with nine regions and nations reporting a higher confidence reading month-on-month.
Optimism in the UK economy also increased in August by 16 points to 37%, and the number of businesses expecting an increase in their trading prospects rose by three points to 46%.
The construction, retail and service sectors all saw a rise in business confidence in August. Services gained 12 points to reach a 22-month high of 42%, while retail firms were up nine points to 44%, an 18-month high. Construction firms’ confidence also increased by 11 points to a four-month high of 42%. In contrast, manufacturing confidence fell for a second consecutive month with a 4-point decline to 30%, taking it to the lowest level since April 2023.
Amanda Dorel, regional director for the South West at Lloyds Bank Commercial Banking, said:
“It’s great to see confidence in the region rebounding to reach the highest levels we’ve seen in 18 months. Businesses are making hay while the sun is shining too, with many taking advantage of buoyed consumer spirits and looking at opportunities to grow, be it by investing in their teams or diversifying into new areas.
“Those who continue manage their working capital and keep a close eye tight margins will be well positioned for the coming months.”