Business confidence in the South West rose in September but firms remain concerned about the state of the economy, new data has revealed.
Overall optimism among the region’s companies increased to 42% over the month, the latest Business Barometer from Lloyds Bank Commercial Banking found.
Businesses reported higher confidence in their own prospects – up 19 points at 55% – and more than a third of South West firms (36%) expect to hire staff over the next year, the research revealed.
The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide. It found that overall UK business confidence had dipped slightly, to 47% – down from August’s 50%.
Amanda Dorel, regional director for the South West at Lloyds Bank Commercial Banking, said: “Firms’ confidence in their own prospects has strengthened this September, a testament particularly to hospitality and leisure businesses who successfully navigated their way through a challenging period of summer trading.”
Projections for output were mixed across the sectors, with some showing significant changes from previous results. In construction, the sharp increase last month was largely counteracted by a drop in expectations in September, falling by 12 points to 46%.
In manufacturing, trading prospects fell for a second month to 53%, although the figure was still stronger than the year-on-year one. However, the falls in manufacturing and construction were offset by a small rise in retail and a bigger rise in the service sector.
“Although overall confidence fell this month, that fall was from a nine-year high and businesses remain positive about their own trading prospects,” added Hann-Ju Ho, senior economist, Lloyds Bank Commercial Banking.
“The more mixed picture for economic optimism points to some businesses maintaining a degree of caution. While we still expect economic expansion, it may occur at a slower rate than the first half of 2024.”