Business confidence in the North East bucked the national trend in February, rising seven points to eight per cent, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies report higher economic optimism at seven per cent, while firms’ confidence in their own business prospects dipped five points to seven per cent.
North East businesses’ hiring intentions show that a net balance of eight per cent of businesses in the region expect to hire more staff during the next year, up four points on last month.
The North East’s rise in overall confidence and increase in economic optimism contrasts with February’s national trends.
Local businesses’ confidence in their own trading prospects also showed more resilience than elsewhere, sliding five points compared with an average fall of 14 points across the UK.
Across the UK, overall confidence fell 15 points to just four per cent as both firms’ optimism about the economy and their confidence in their own prospects slumped.
Nationally, firms’ confidence in their own trading prospects fell 14 points to 13 per cent while economic confidence fell by 15 points to minus five per cent.
Meanwhile, a net balance of 12 per cent of businesses across the North East said they felt that the UK’s exit from the European Union was having a negative impact on their expectations for business activity, an increase of four points on January’s results.
The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.
Kelly Green, regional director for the North East at Lloyds Bank Commercial Banking, said: “Along with the North East’s rise in overall confidence, it’s encouraging to see an increase in the number of businesses planning to hire new staff, a sign of optimism from local firms operating in what are difficult times for some.
“To support businesses in their plans for growth, we’ve committed to lend up to £700m to North East businesses in 2019, and we’ll be on hand to offer local firms our advice and guidance.”
Businesses in the North West showed the most confidence, at 12 per cent, ahead of the West Midlands (11 per cent), with the North East showing the third highest result.
Those in Wales were the least confident, with an overall confidence of minus two per cent, six points below the national average.
Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking commented: “Political uncertainty has clearly affected business confidence across the UK, but the underlying economy remains resilient and is able to absorb short-term volatility.
“The modest rise in optimism at the start of the year was no more than a blip as uncertainty continues to impact on business confidence. The results suggest that near-term economic growth prospects have moderated further, but there is potential for a recovery further out should uncertainties subside.”