South East business confidence slips in January

News Posted 31/01/23
Companies in the South East reported lower confidence in their own business prospects month-on-month, down 21 points at 8%, in January 2023, according to Lloyds Bank’s Business Barometer.

When taken alongside their optimism in the economy, up five points to 4%, this gives a headline confidence reading of 5%.

The region’s businesses identified their top target areas for growth in the next six months as diversifying into new markets (32%), evolving their product and service offering (28%) and investing in their team (23%).

A net balance of 5% of businesses in the region expect to increase staff levels over the next year. This is down from December when a net balance of 19% of businesses reported plans to make new hires.

Overall UK business confidence climbed in January, with firms reporting their highest confidence levels since July last year.

Business confidence increased by five points to 22% and the net balance of businesses feeling optimistic about the economy doubled on December’s reading to 16%.

Ahead of National Apprenticeship Week (6-12 February), 30% of businesses across the UK reported that they are looking at opportunities to grow by investing in staff development and training. A net balance of 17% of firms reported plans to create new jobs in the next twelve months.

Paul Evans, regional director for the South East at Lloyds Bank Commercial Banking, said: “Falls in confidence and hiring expectations might not be the positive start to 2023 that businesses were hoping for, but both are still in positive territory as firms display cautious optimism about the year ahead.

“Of course, there are still challenges in the wider economic environment and we’ll continue to be by their side as they navigate hurdles and turn their plans into real growth.”

For the second month in a row, confidence in the manufacturing and service sectors increased, with manufacturing rising to 28% (up 15 points) and services up to 25% (up seven points).

Business confidence in construction was down two points to 27%, while retail confidence fell for the second month in a row to 7% (from 13%), the lowest level since February 2021.

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