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Economy

North East business confidence at highest levels since February 2018

Business confidence in the North East has risen for the third month in a row to its highest level since February 2018.

The Business Barometer from Lloyds Bank, which surveys 1200 businesses each month to provide early signals about UK economic trends, rose 11 points during April to 37 per cent.

Companies in the North East reported higher confidence both in their own business prospects (up 10 points to 36 per cent) and in their optimism about the economy (up 11 points to 38 per cent).

This gives a headline confidence reading of 37 per cent – a three-year high.

When it comes to jobs, a net balance of 20 per cent of businesses in the region expect to increase staff levels over the next year, up 10 points on last month.

Overall UK business confidence surged 14 points in April to 29 per cent, the highest reading since September 2018.

The result follows the reopening of outdoor hospitality venues and non-essential retail and personal services providers in England and comes ahead of further restrictions easing in Wales and Scotland. Firms’ confidence in their own business prospects rose by 14 points to 26 per cent, and their optimism in the economy increased by 15 points to 32 per cent.

Most UK regions and nations reported a month-on-month increase in confidence during April, with firms in the South West (up 22 points to 30 per cent), London (up 20 points to 32 per cent), the East Midlands (up 20 points to 40 per cent) and Yorkshire and the Humber (up 20 points to 32 per cent) reporting the largest surges.

No nation or region reported a fall in confidence, and nowhere had a net-negative confidence reading for the first time since July 2019.

Steve Harris, regional director for the North East at Lloyds Bank Commercial Banking, said: “Business confidence in the North East has surged again – a clear reflection of the positive impact the reopening of both hospitality and retail is having on businesses.

“It’s also encouraging to see that more firms are planning to increase staffing levels this year in another sign that we are on the road to recovery.

“We’ll continue to stand by businesses in the region over the coming weeks and months as they look to build back stronger.”

Hann-Ju Ho, senior economist at Lloyds Bank Commercial Banking, added: “A third consecutive monthly rise in business confidence alongside the highest level of confidence for two-and-a-half years tells us a positive story about the UK’s continued economic recovery and leaves us optimistic about the road ahead.”