Region's business confidence up in June - report

Business confidence in the West Midlands rose six points during the beginning of June to 36 per cent, according to the latest Business Barometer from Lloyds Bank Commercial Banking.?

Companies in the region reported higher confidence in their own business prospects month-on-month, up two points at 39 per cent.? When taken alongside their optimism in the economy, up 10 points to 32 per cent, this gives a headline confidence reading of 36 per cent.??

West Midlands businesses identified their top target areas for growth in the next six months as investing in sustainability (36 per cent), diversifying into new markets, and investing in their team (both 30 per cent).
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The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide.?
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A net balance of 36 per cent of businesses in the region expect to increase staff levels over the next year, up nine points on last month.?

Overall, UK business confidence increased by nine points to 37 per cent in June, with all regions reporting a positive confidence reading. Eight out of 10 regions reported a higher confidence reading than in May.

Business confidence for firms in the service sector rose to 37 per cent (up 11 points), the highest seen since February 2022. With the recent spell of good weather and a reduction in food and energy prices, businesses in leisure and hospitality may be able reap the rewards in the months to come.

Manufacturing firms ' confidence also increased to its highest level since early 2022, rising to 50 per cent (up 10 points) to outperform other sectors.

It 's great to see businesses in the West Midlands feeling more confident, particularly in their optimism for the UK economy. Despite ongoing inflationary challenges, the region 's firms remain positive and continue to anticipate opportunities to drive investment and deliver on growth plans.?

Dave Atkinson (pictured), regional director for the West Midlands at Lloyds Bank Commercial Banking, said: “For those looking to diversify into new markets there are tools available to help them to examine international opportunities, such as the international trade portal, and those looking to increase their sustainability or invest in new lower-carbon equipment can access discounted lending through the Clean Growth Finance Initiative. ”

Hann-Ju Ho, senior economist Lloyds Bank Commercial Banking, said: “It 's encouraging to see business confidence rebounding following last month 's five-point dip to 28 per cent. Trading prospects and optimism have seen a resurgence this month with overall confidence up in all but two of the twelve regions of the UK, which shows positive prospects across the wider economy.

“However, interest rate rises and cost pressures are still felt by many and we await to see the impact of the latest 50 basis point rise in the base rate. Meanwhile, expectations for average pay growth, although down slightly this month, appear to have picked up compared with the start of the year and remain elevated relative to pre-pandemic levels. ”