Business confidence in the East Midlands rose 18 points during February to 10%, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies in the East Midlands reported higher confidence in their own business prospects month-on-month, up 13 points at 4%. When taken alongside their views of the economy, up 22 points to 16%, this gives a headline confidence reading of 10%.
The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.
When it comes to jobs, a net balance of 13% of businesses in the region expect to increase staff levels over the next year, up 16 points on last month.
Across the UK, overall business confidence rose in February as the government announced it would be creating a ‘roadmap’ out of lockdown. Confidence increased by nine points to 2%, the first net positive reading since March 2020. Firms’ economic optimism also jumped 12 points month-on-month to 2%.
All UK nations and regions saw a month-on-month increase in confidence in February, with the East Midlands (10% vs -8% in January) reporting the joint biggest increase alongside the North West (13% vs -5% in January), followed by Wales (-5% vs -20% in January) and Scotland (-17% vs -32% in January). Despite this, four remained in net negative territory with Wales (-5%), the South West (-6%), the East of England (-8%), and Scotland (-17%) all in the red.
Amanda Dorel, regional director for the East Midlands at Lloyds Bank Commercial Banking, said: “Firms’ confidence is rebounding strongly in the region as businesses start to look ahead to the easing of lockdown restrictions. For the first time since March last year, a net balance of firms are now looking to increase their staff levels over coming months, which will undoubtedly give the region’s economy a much needed boost.
“Of course, businesses across the East Midlands continue to face significant challenges and we remain by their side, offering the support they need to navigate the road ahead.”
Confidence increased across all four broad industry sectors to the highest levels since March 2020. After a soft start to the year, manufacturing jumped by fourteen points to 5%, while construction rose eight points to 7%. Confidence in retail extended nine points to 3%, while services advanced by ten points to 1%, led by broad-based improvements in the subsectors.
Hann-Ju Ho, Senior Economist for Lloyds Bank Commercial Banking, said: “The uplift in business confidence and its entry into positive territory after nearly a year suggests that firms are cautiously pinning their hopes on economic revival in the future and the continued success of the vaccine rollout. In the coming weeks, announcements in the Budget and prospects of an easing of lockdown restrictions will hopefully help to bolster the recovery in business confidence as the economy starts to reopen.”