Reports find UK business confidence at six month low

 Tuesday, 10th September 2019 10:54

The latest findings from Lloyds Banking Business show that UK business confidence fell for the first time in three months in August 2019 – by 12 points. The reduction in confidence to 1% brings business confidence to just below the level seen in June 2016, and further below the long-term average of 24%.

The results are the findings of a recent survey which canvassed the views of 1,200 UK companies and their assessments of their trading and optimism for the UK economy. The percentage of companies who were expecting their trading prospects to improve over the coming year was a worrying 8%. Last year this figure was 19%.  Declines were also noted in headcount and recruitment. (Down to a further 6%).  Companies expecting trading prospects to improve over the coming year dropped from 19% to 8%.

 

Brexit was – unsurprisingly – a topic of concern. According to a third of all companies surveyed, leaving the EU will have a negative impact on business. Interesting, 21% of business anticipate leaving the EU to have a positive impact.

 

Across the 12 regions, the West Midlands experienced the smallest decline in business confidence. The largest decline was seen in the East Midlands - down 23 points to 3%. Whist the construction sector showed promise with a rise of 6 points to 12%, other sectors noted a fall; particularly retail (down to 6%) and manufacturing (down to 3%) who recorded the lowest levels of confidence for 2019.

Senior Economist, Hann-Ju Ho, Lloyds Bank Commercial Banking, commented “We have seen a dip in overall business confidence this month, with firms appearing less positive about their own trading prospects and the broader economy, and remaining low against the historic average.  While ongoing economic uncertainty is likely a key driver, it’s worth noting that companies’ assessment of the expected impact on their business of the UK leaving the EU has remained broadly unchanged this year.”

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