Thames Valley: Business confidence increases

Business confidence in the Thames Valley has increased over the past year, with nine out of ten company leaders stating they feel confident about their own business’s prospects, according to a recent survey.

When polled at an event hosted by professional services firm KPMG, law firm Osborne Clarke and The Royal Bank of Scotland in Reading last week, 64% of business leaders said they felt ‘confident’ and 26% were ‘very confident’ about their company’s prospects. The increase represents a rise of 19%, compared with the findings of last year’s survey.

The majority of business leaders were also positive about the coalition Government’s recovery plan. Over two thirds (67%) stated they believe it was right for the UK economy, an increase of 40%, compared with just over a year ago when uncertainty was the prevailing sentiment immediately after the coalition was formed. Only 5% of respondents disagreed with the Government’s plan whilst just over a quarter (28%) remained uncertain.

However, business leaders’ optimism in the economy was less upbeat than last year, with a total of 43% of respondents reporting they felt the economy would perform better in the year ahead, down 28 percentage points from 71% in 2010.

Tony Cottam, senior partner at KPMG’s Reading office, said: “Whilst our survey revealed that business leaders recognise the year ahead will be tough, it was good to hear that they are feeling confident in their own business’s prospects - particularly given the fragile sentiment surrounding the economy. Perhaps this greater level of confidence is an indication that while external factors remain tough they are holding their nerve and working hard to maintain a focus on their own priorities, regardless of the wider economy.”

Businesses reported a range of business issues they were currently managing, with their main concern being the cost and complexity of regulation, which remained the top response from last year’s survey.

Danielle Kingdon, head of Osborne Clarke’s Thames Valley office, said: “Regulation continues to be a major issue for businesses but a number of different economy-related concerns followed closely behind, including winning new customers and persuading them to spend; worries regarding consumer confidence; and the difficulty of planning during this period of uncertainty. Recruiting staff with the right skills also ranked highly and all of these highlight the myriad issues which businesses currently find themselves juggling.”

Respondents were also asked about the issues facing the government and the economic theme continued with the leading response being balancing inflation, spending cuts and stimulating growth. This was followed by gaining credibility and public confidence and working together as a coalition successfully and staying consistent.

Robin Barnes, regional director at The Royal Bank of Scotland commented: “Businesses recognise that the external environment is tough and that it’s set to stay that way for the time being. But one of the most positive themes which guests reported on the evening was that despite the challenges which face businesses, they still feel that the Thames Valley remains a good place to do business. Their confidence in the region and their own organisations is highly positive during this challenging time.”

Guests who attended the event heard a unique take on business, the economy and government from guest speaker Danny Finkelstein, executive editor at The Times and Political Commentator of the Year 2010.