Business confidence in Wales has risen at the fastest rate anywhere in the UK, according to new research from Lloyds Bank Commercial Banking.
Confidence levels for September, in the latest business barometer from the bank, rose 27 points to 46%.
Companies in Wales also reported higher confidence in their own business prospects month-on-month, up 26 points at 42%. When taken alongside their optimism in the economy, up 28 points to 50%, it gave an overall headline confidence reading of 46%.
A net balance of 24% businesses in Wales expect to increase staff levels over the next year, up 16 points on last month.
Overall UK business confidence rose 10 points in September to 46%, with all regions and nations reporting double-digit confidence levels.
Although Wales experienced the highest increase of any nation or region in the UK on the previous month, six English regions, led by London at 62%, had higher net positive headline confidence levels.
The number of businesses planning on hiring new staff more than doubled from 18% to 37% as firms look to increase headcount over the next 12 months. Overall confidence in trading prospects rose by nine points to 43% and firms’ optimism in the economy increased by the same amount to 48%.
Amanda Dorel, regional director for Wales at Lloyds Bank Commercial Banking, said: “Wales has been more cautious than other parts of the UK when it comes to easing coronavirus restrictions, but there is a real sense now that businesses are in a much stronger position than they have been since the coronavirus outbreak.
“We hope that this will help them to remain resilient in the face of current challenges including the ongoing fuel disruption, and labour and supply chain shortages that are affecting a wide range of industries. Whatever the coming weeks and months bring we’ll continue to be there to support Welsh businesses.”
Confidence increased across the four broad sectors, notably in manufacturing and services.
Manufacturing (up nine points to 49%) reached a four-month high, while services gained 11 points to 47%, the highest since early 2017, with particularly strong trading prospects in hospitality, and financial and business services. Retail confidence improved by eight points to a four-month high of 42%, while construction only edged up by one point to 41% which was nevertheless a three-year high.
Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said: “It remains encouraging to see a further improvement in business confidence reaching its highest level since April 2017.
“Employment expectations have risen significantly, with more than half of businesses expecting to recruit in the next 12 months. The hope is that the availability of labour will increase to alleviate current staff shortages for many firms, which will help to underpin UK economic growth over the medium term.”
