Business confidence among South East firms fell in October

By Giles Gwinnett

1 November 2023

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Confidence among businesses in the South East fell three points during October this year to 30%, while overall in the UK it rose three points to 39%, according to the latest Business Barometer from Lloyds Bank commercial banking.

The banking giant's study surveys 1,200 businesses a month.

Meanwhile, firms in Yorkshire reported the highest levels of confidence, jumping 12 points to 52% - the highest reading for the region since March 2022, the data showed.

Companies in the South West reported the biggest uptick, increasing 26 points month-on-month to 47%.

"Despite a small a dip, business confidence in the South East remains resilient," noted Becci Wicks, regional director for the south east at Lloyds Bank Commercial Banking.

"However, optimism in the wider economy is low compared to most other UK regions and nations and it’s possibly hampering firms’ ability to invest," she added.

"As we head into the final quarter of the year, it’s important that firms keep a close eye on their working capital so they’re primed to seize opportunities for growth. We’ll be by their side to strategically target the areas where investment will drive expansion and help them to thrive."

In the south east, businesses identified their top target areas for growth in the next six months as evolving their offer (38%), investing in their team (32%), and diversifying into new markets (29%).

Meanwhile, 30% net of businesses in the region expect to increase staffing over the next year, which was up two points on last month.

Hann-Ju Ho, senior economist at Lloyds Bank Commercial Banking, said: "Business confidence this month reflects a more positive outlook as we head into the important festive period, with trading prospects and economic optimism both at their second highest levels this year.

"The level also underlines the wider upward trend of steadily rising confidence in 2023. If you look at the year in quarterly time periods, confidence has steadily risen from 20% in the first quarter, 26% in the second and in September an average of 27% in the third."

But Hann-Ju Ho highlighted too that the data showed that firms were still "safeguarding" their profit margins amid the possibility of interest rates remaining high, wage increase pressures, and the prospect of higher energy prices again this winter.

"Therefore, businesses will be keeping a keen eye on the forthcoming Autumn Statement and Bank of England policy announcements as they navigate through a challenging economic period ahead."

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By Giles Gwinnett

Giles Gwinnett is a writer at The Business Magazine. He has been a journalist for more than 20 years and covered a vast array of topics at a range of media settings - in print and online. After his NCTJ newspaper training, he became a reporter in Hampshire before moving to a news agency in Gloucestershire. In recent years, he has been covering the financial markets along with company news for an investor-focused web portal. His many interests include politics, energy and the environment. He lives in Dorset.