WM business confidence remains steady
Business confidence in the West Midlands has remained steady as firms expect strong trading conditions, new figures reveal.
Business confidence fell one point during May to 30%, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies in the region reported higher confidence in their own business prospects month-on-month, up five points at 37%. When taken alongside their optimism in the economy, down eight points to 22%, this gives a headline confidence reading of 30%.
West Midlands businesses identified their top target areas for growth in the next six months as introducing new technology (43%), evolving their offer (37%) and investing in sustainability (36%).
The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide.
A net balance of 27% of businesses in the region expect to increase staff levels over the next year, up nine points on last month.
Overall UK business confidence dropped five points to 28% in May. Despite the dip, every UK nation and region report a positive confidence reading.
As the country celebrated the Coronation, London reported the highest levels of business confidence at 43% (down four points on last month), followed by the North East at 35% (down six points month-on-month). Alongside the West Midlands, the South East and South West also reported high readings in May, all at 30%.
Firms remain optimistic about their own trading prospects, with a net balance of 34% expecting business activity to increase over the next 12 months, down just five points on last month.
Dave Atkinson, regional director for the West Midlands at Lloyds Bank Commercial Banking, said: “Businesses demonstrated their resilience as confidence held steady in May. The West Midlands was one of just two regions to record an increase in the number of firms expecting strong trading conditions for the year ahead, a sure sign of the region’s optimism.
“As the warm weather returns, businesses in the retail and leisure sectors will be hoping for a boost to footfall and customer spending. To help during busy periods, firms should keep a close eye on managing their working capital and unlock financial support when they need it to capitlise on growth opportunities.”
Confidence among manufacturers increased to a one-year high of 40% (up from 29%), while retail registered a more modest two point rise to 26%, and construction remained robust at 34% despite its monthly nine point decline. Services confidence, however, fell back to 26% from 36%, almost erasing last month’s rise. Overall, confidence across the broad sectors remains above levels at the start of the year.
