Business confidence across the South West has plummeted as firm get the jitters ahead of planned Brexit on October 31.
Confidence among the region’s private sector firms dropped 12 points during September 2019 to -1%, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies in the region report lower confidence, amongst all of the UK, in their business prospects at 10%. When taken alongside their views of the economy overall, this gives an overall confidence of -1%.
Across the region, a net balance of 37% 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, up 25 points on a month ago.
David Beaumont, regional director for the South West at Lloyds Bank Commercial Banking, said: “The South West is a robust and resilient region, but September has seen a sharp decline in business confidence.
“When businesses can begin to plan with a little more clarity, we expect confidence to bounce back, as it has in the past.
“In the meantime, we are by the side of those businesses and supporting them through the opportunities and challenges they face. This is why we have committed to lending £1.5billion to companies across the region, as part of our commitment to help businesses in Britain prosper at any point in the cycle.”
Across the UK, overall confidence rose one point to 2% as firms’ confidence in their own prospects climbed five points to 13%.
Businesses in the East Midlands showed the most confidence, at 15%, ahead of the West Midlands and Yorkshire (both on 7%).
Those in Scotland were the least confident, with an overall confidence of -18%, 20 points below the national average.
Overall confidence remained the weakest in the manufacturing sector, where it fell by five points to -2%, a major contributor to the South West economy, and the services sector, which remained unchanged at -3%.
Overall business confidence in the retail sector rose by eight points to 14%, but fell two points in the construction sector to 10%.
The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.
Hann-Ju Ho, senior economist at Lloyds Bank Commercial Banking, said: “While overall business confidence this month has remained broadly steady across the UK, optimism in the economy has fallen, and both remain significantly below the same period last year, and the historic average.
“This month we are also seeing firms’ concerns about leaving the EU intensify against the backdrop of ongoing economic uncertainty.”
