West Midlands remains top for business confidence – Lloyds Bank

Remaining unchanged at 48 per cent, business confidence in the West Midlands is the highest in the UK for the second month running, according to the Lloyds Bank Business Barometer.

The survey, conducted between 1-15 March (and therefore before the Chancellor’s Spring Budget) found companies in the region reported lower confidence in their own business prospects month-on-month, down two points at 55 per cent.  When taken alongside their optimism in the economy, down one point to 40%, this gives a headline confidence reading of 48 per cent.

West Midlands businesses identified their top target areas for growth in the next six months as investing in their team (45 per cent), diversifying into new markets (36 per cent), and evolving their offer (28 per cent).

The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide.

A net balance of 29 per cent of businesses in the region expect to increase staff levels over the next year, down 21 points on last month.

Read more - West Midlands confidence remains ahead of UK, despite fall says Lloyds Bank business barometer

Dave Atkinson, regional director for the West Midlands at Lloyds Bank Commercial Banking, said: “It’s great to see the West Midlands remaining the most confident region in the UK.

“Businesses see investing in their teams as a key area for growth, and the news that the region is set to secure funding and greater control over skills and technical education, will be welcomed by many. We will be by the side of businesses to support them with the financial tools and advice they need to make the most of the opportunities ahead.”

There was a broad rise in business confidence across the sectors, particularly in construction (47 per cent, up 28 points) and manufacturing (37 per cent, up ten points) both at a ten-month high and retail (32 per cent, up 11 points) the highest since February 2022.

Hann-Ju Ho, Senior Economist Lloyds Bank Commercial Banking, said: “Business confidence has seen a surge this month with economic optimism and trading prospects bolstering firms. With hiring intentions improving, we may see employment growth picking up in the coming months. Tentative signs of easing wage pressures suggest that businesses’ difficulties in finding staff may have started to ease.

“Although the measures in the Budget were widely trailed, it is yet to be seen what the full impact of the Chancellor's announcement, along with the surprise rise in inflation and recent increase in interest rates, will have had on business confidence.”

Read more - Business leaders seek tax, trade and skills support to meet challenges of the next twenty years – Lloyds Bank Business Barometer