Business confidence on the rise for Welsh firms

Business confidence in Wales rose eight points during November to 10%, according to the latest Business Barometer from Lloyds Bank Commercial Banking.

Companies in Wales report higher confidence in their business prospects at 15% and higher economic optimism at 5%. Together, this gives an overall confidence of 10%.

Businesses’ hiring intentions showed that a net balance of 8% of businesses in the region expect to hire more staff during the next year, on par with last month.

Across the UK, overall confidence rose three points to 9% as firms’ optimism about the economy rose 10 points to 7%, although their confidence in their own prospects dropped three points to 12%.

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

Amanda Dorel, regional director for Wales at Lloyds Bank Commercial Banking, said: 

“As we near the end of the year, it’s good to see businesses across Wales regaining confidence in their own prospects and the local economy.

“We’re committed to helping Welsh businesses grow, and pledged £1.1billion this year to support them through uncertain times. We will be by their side as they tackle whatever lies ahead.”

Across the region, a net balance of 10% of businesses said they felt that the UK’s exit from the European Union was having a negative impact on their expectations for business activity, down two points on a month ago.

Regional picture

Businesses in the West Midlands once again showed the most confidence, at 24%, ahead of London at 20%, and East Midlands at 14%.

Those in Scotland were the least confident, with an overall confidence of -6%, 15 points below the national average.

National overview

Overall business confidence improved in manufacturing, retail and services and stayed broadly steady in construction. The largest increase was in the retail sector, rising six points to 21%, while the construction sector remained high at 16% despite a slight decline of two points.

Sentiment in the manufacturing sector rose to a four-month high of 10%, while services confidence also increased for a second month, by four points to 4%.

Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking, said:

“The third consecutive increase in overall business confidence is positive for the UK as economic optimism reaches the highest level since January.

“While concerns about the impact of the UK leaving the EU continued to ease slightly, hiring intentions remain broadly stable and it will be interesting to see how this trend continues towards the end of 2019 and into the start of next year.”