Latest Business Barometer from Lloyds Bank Commercial Banking reveals confidence in the region remains in negative territory amid the ongoing COVID-19 crisis. Tony McDonough reports
Businesses in the North West have higher confidence in their prospects than any other region in the UK, new data shows.
But the latest Business Barometer from Lloyds Bank Commercial Banking reveals confidence in the region remains in negative territory amid the ongoing COVID-19 crisis. And 25% of firms in the North West expect to cut staff in the next 12 months.
It shows business confidence in the North West rose 11 points during October to -2% while, across the UK, overall confidence dropped seven points month-on-month to -18%. The Business Barometer questions 1,200 businesses monthly.
UK business confidence has remained in negative territory since the height of the first wave of the pandemic in April, but the picture had been improving, with confidence steadily rising since May.
While sectors such as leisure and hospitality continue to struggle with restrictions and lockdowns, the manufacturing sector is show signs of improvement. Last week Jaguar Land Rover, which employs around 4,000 people in Merseyside, revealed it had returned to profitability in the three months to September 30.
Glenn Bemment, regional director for the North West at Lloyds Bank Commercial Banking, said: “Month by month, North West firms have slowly been edging closer to regaining an overall positive outlook.
“And with many key sectors like operating close to full capacity despite increased local lockdowns, it’s likely these industries will be helping to buoy confidence in the region. Our region has proven its resilience throughout this crisis.”
The East of England was the second most confident region in the UK at -8%, followed by the North East (-10%) and West Midlands (-15%). Optimism fell 21 points in Yorkshire to -29%, making it the least confident UK region.
In the industry sectors, services slipped back, with confidence declining by 14 points to -24%. The decline was driven by hospitality and arts and leisure grappling with the implications of recently introduced measures to tackle the pandemic. Manufacturing and retail logged modest improvements, up three points to -15% and up one point to -7% respectively.
Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking, said: “The resurgence in coronavirus cases and the reintroduction of local lockdown measures saw overall business confidence fall back sharply this month.
“Added to that are ongoing uncertainties regarding new trading arrangements with the EU in January. All of this makes the economic outlook uncertain and the period ahead will be pivotal for businesses as they navigate the winter months and continue to adapt to the evolving landscape.”