West Midlands ends 2018 as most confident region outside London
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West Midlands firms experienced a sharp fall in business confidence during December but remained the most positive UK region outside of London.
Lloyds Bank Commercial Banking’s latest Business Barometer shows that West Midlands companies report lower confidence in their business prospects, down 32 points to 35%, and slightly lower economic optimism, which fell two points to 20%.
Together, these bring the region’s overall confidence down to 27%, 12 points below last month’s figure of 39%.
However, confidence fell across the UK and the West Midlands remains the most confident region outside of London, where confidence dipped slightly to 32%.
Nationally, overall confidence fell seven points to 17% as UK firms’ optimism about the economy dropped 10 points to seven per cent while companies’ confidence in their own business prospects slipped five points to 26%.
The fall in confidence in the West Midlands was reflected in local firms’ hiring intentions, with a net balance of 16% expecting to hire more staff during the next year, down 16 points on last month.
A net balance of 22% of West Midlands companies also said they felt that the UK’s exit from the European Union was having a negative impact on their expectations for business activity. This compares with a net balance of seven per cent who thought it was having a positive impact a month ago.
The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.
Amanda Dorel, regional director for the West Midlands at Lloyds Bank Commercial Banking, said: “While business activity is still strong in the West Midlands, it appears that increased uncertainty and falling global demand this month have had an impact on firms’ confidence and hiring intentions.
“However, it is encouraging to see that businesses’ optimism about the UK economy has fallen only slightly, making it the most positive region outside of London and demonstrating the resilience of companies in the West Midlands.”