Job creation on the horizon for South West businesses

Hiring intentions in the South West are higher than the national average, with a net balance of 31 per cent of firms expecting to recruit more staff during the next year, according to the latest Business Barometer from Lloyds Bank Commercial Banking.

Companies in the South West also expect a median annual increase in average pay of one to two per cent during 2018.

Firms reported slightly lower than average business prospects at 38 per cent, but marginally higher than average economic optimism at 32 per cent.

Overall business confidence in the region is in line with the national average at 35 per cent.

Nationally, overall confidence has risen seven points to a nine-month high of 35 per cent, driven mainly by a rise in firms’ economic optimism.

The Business Barometer provides early signals about UK economic trends and has been run monthly since January 2002. This is the first time that the survey, which questioned 1,200 businesses, has been carried out on a regional as well as national basis.

Andrew Kemp, regional director for the South West at Lloyds Bank Commercial Banking, said: “Firms in the South West started the year positively, with business confidence matching the UK average and solid hiring intentions for the year ahead.

“I’d hope to see businesses capitalise on this confidence during the first quarter, laying a solid foundation for growth in the next 12 months.”

South West businesses’ economic optimism (32 per cent) is higher than the national average of 31 per cent.

Meanwhile, their confidence in their own business prospects (38 per cent) is one point lower than across the UK as a whole.

Across the region, a net balance of just seven per cent of businesses feel that the UK’s exit from the European Union is having a negative impact on their expectations for business activity.

Regional picture

Overall confidence is highest among businesses in London and the North West, both at 47 per cent, followed by the West Midlands at 45 per cent.

Businesses in Wales are the least confident, with an overall confidence 21 points below the national average at 14 per cent.

Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, commented: “Although business prospects have softened from last month’s high, overall UK business confidence is starting the year on a strong footing. The sharp increase in economic optimism signals that downside risks have eased and the economy is likely to continue to expand in Q1 this year.”