South East: Businesses happier than national counterparts, says Grant Thornton

The latest ICAEW/Grant Thornton UK Business Confidence Monitor (BCM) has found that businesses in the South East are starting to feel the benefits of the burgeoning UK economic recovery. Confidence in the region has been on an upward trend over the past year and now stands at +35.9, well above the UK national average of +31.7. 

Companies in the South East have seen robust levels of growth in their key financial performance indicators over the past 12 months. Annual rates of growth have been accelerating over recent quarters, with turnover rising by 4.9% and sales volumes by 5.0%. Moreover, companies expect further improvements in performance over the coming year, predicting turnover and sales volumes to grow by 6.4% and 6.2% respectively.

Businesses in the South East are also reporting that exports grew by 4.2% over the past year, while also anticipating export growth to continue over the coming 12 months, predicting a rise of 4.8%. These expectations are in line with projected domestic sales increases of 5.2% over the next year.

Andrea Dunhill, ICAEW regional director for London and South East, said: “This quarter’s report suggests that the UK economic recovery is well underway. If it continues at this rate, the UK economy could be one of the fastest-growing economies in the western world going into 2014. However, businesses will need work hard to maintain the momentum built up this year while remaining alive to the threats to economic recovery, especially those arising outside the UK.”

This quarter, annual employment growth for businesses in the South East was reported at 1.0%. Private sector job creation has helped keep the region’s unemployment rate low compared with the UK as a whole, standing at 6.0% over the three months to August 2013; the UK national average stands at 7.7%.

Norman Armstrong, partner at Grant Thornton in Southampton, said: “It is promising to see businesses in the South East showing consistent optimism about what the future holds. What they must do now is ensure they are ready to grab those opportunities as they arise, and that means making sure they have the right team, the right skills and the right equipment. Being optimistic for growth is one thing, being prepared for it is quite another.”