Business confidence in South East falls 17 points

By Tom Kilkelly

2 May 2023

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Companies in the South East are reporting lower confidence in their own business prospects month on month and the economy according to Lloyds Bank Commercial Banking’s latest business barometer.

Business confidence is down a total of 17 points in April to 11 per cent, this total is a combination of how confident companies feel about their month on month business prospects (down 11 points at 25 per cent) and their optimism about the economy (down 19 points to minus four per cent).

To combat this lack of confidence businesses in the region have identified what they believe are key areas of growth in the coming months: 36 per cent said they needed to evolve company offerings, 33 per cent are looking to invest in their teams, and 26 per cent are aiming to branch into new markets.

Regional director for the South East at Lloyds Bank Commercial Banking Paul Evans said: “Despite the dip in overall business confidence, the South East remains firmly in positive territory and there are green shoots of growth coming through.

“It’s encouraging that many businesses are optimistic about their trading prospects for the coming months. Combined with feedback I’ve had from businesses, we can see that many are still charting a course for growth.

“Demand for solutions that boost working capital, such as asset finance, have been rising in recent months as firms seek to quickly unlock funding to capitalise on opportunities, and we’ll be by firms’ side as they work to deliver this.”

The drop in confidence in South East businesses is a stark contrast to the rest of the country. In April UK business confidence was up to 33 percent, a single point increase. London reported the highest levels of business confidence at 47 per cent (up nine points month-on-month); followed by the East Midlands (up 18 points) and the North East (up three points), both at 41 per cent.

Senior economist for Lloyds Bank Commercial Banking Hann-Ju Ho said: “The recent increases in business confidence indicate that the economy entered the second quarter of 2023 with positive momentum.

“The revival in the demand for labour, which improved for the fifth consecutive month, may account for the modest uptick in wage expectations for the next twelve months.

“While firms’ concerns on overall cost pressures have eased, there is little evidence that pricing expectations have declined which may impact wider pricing decisions for the remainder of 2023.”

By Tom Kilkelly

Tom Kilkelly started working as a freelance journalist for The Business Magazine following his graduation from UCL in 2022.

During his studies Tom became very interested in the works of Irish authors including Samuel Beckett and Flann O'Brien (Brian O'Nolan).

His current role as a freelance business reporter is his first exposure to the world of business journalism. Working at TBM has given Tom the chance to really get to grips with the goings-on in the business hive that is the South East.