North East firms are more confident about their prospects than contemporaries in any other region, new research suggests.
The findings of the Lloyds Bank Business Barometer for May found that despite confidence falling six points to 35% during the month, the region is still second highest of all UK nations and regions. Firms pointed to priorities in the next six months being investment in new technology (45%), investing in teams (37%) and investing in sustainability (37%).
And a net balance of 33% of North East companies expect to increase staff levels over the next year, down five points on last month. It comes as overall UK business confidence dropped five points to 28% across the month.
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Data taken from Lloyds’ surveying of 1,200 business shows confidence among manufacturers took a leap to a one-year high of 40%, up from 29%. Meanwhile sentiment among retailers grew two points to 26% construction fell nine points to 34%. And service sector confidence tumbled back to 26% from 36%, almost reversing a rise in the previous month.
Steve Harris, regional director for the North East at Lloyds Bank Commercial Banking, said: “It’s fantastic to see that confidence in the North East remains firmly in positive territory and businesses in the region are feeling optimistic about their own prospects in the coming months. In the run up to what many in the hospitality and leisure sector will be hoping is a busier summer trading period, firms should take stock of their working capital. Many could benefit from corporate cards, asset finance and overdraft facilities to help manage any peaks in demand.”
The business picture follows data on consumer confidence published by Deloitte earlier this month. Its Consumer Tracker found a three-point rise in North East sentiment across the first quarter, on the back of more confidence in the wider economy. The survey also suggested that consumer and leisure spending in the region would rise over the next three months.
Donna Baker, tax partner and consumer business lead at Deloitte in the North East, said: “Confidence is higher in the North East than the average across the UK as there has been an overall improvement to sentiment year-on-year. Overall confidence is highest around job opportunities and career progression and levels of debt, however that confidence has been eroded slightly by reduced confidence in job security and children’s education and welfare.”
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