Business confidence in the North West fell one point during April to 34%, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies in the North West reported lower confidence in their own business prospects month-on-month, down one point at 34%.
When taken alongside their optimism in the economy, down one point to 34%, this gives a headline confidence reading of 34%.
North West businesses identified their top target areas for growth in the next six months as investing in their team (42%), investing in sustainability (35%) and diversifying into new markets (28%).
The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide.
A net balance of 33% of businesses in the region expect to increase staff levels over the next year, down 12 points on last month.
Overall, UK business confidence climbed one point to 33% in April. Every UK nation and region reported a positive confidence reading and six out of 11 regions recorded a higher reading than last month. London reported the highest levels of business confidence at 47% (up nine points month-on-month), followed by East Midlands (up 18 points) and North East (up three points), both at 41%.
Firms’ outlook on their own trading prospects remained strong at 39% for the second consecutive month, and a net balance of 27% of businesses are intending to increase their staff levels, up two points on March.
Ahead of the three Bank Holidays in May, firms’ optimism in the overall economy increased five points to 28% – the highest reading since June last year.
Martyn Kendrick, regional director for the North West at Lloyds Bank Commercial Banking, said:
“It’s great to see the region’s business confidence remain strong for another consecutive month. It’s also encouraging to see firms planning on investing in their
teams, targeting business growth through new hires and driving long-term success by building talent through training and development.
“We’ll continue to be by the side of businesses in the North West, offering advice and funding to help their growth plans stay on track.”
Business confidence in the service sector rose to 36% this month, the highest since May 2022, with sentiment particularly upbeat in hospitality and financial services. While
the other sectors saw slight decreases, construction remained strong at 43% while manufacturing and retail remain above last year’s lowest levels.
Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said:
“The recent increases in business confidence indicate that the economy entered the second quarter of 2023 with positive momentum.
“The revival in the demand for labour, which improved for the fifth consecutive month, may account for the modest uptick in wage expectations for the next twelve months.
“While firms’ concerns on overall cost pressures have eased, there is little evidence that pricing expectations have declined which may impact wider pricing decisions for the remainder of 2023.”
