- Business confidence in the North East rose 16 points to 59% – the highest of any UK nation or region in April
- Firms’ optimism in their own trading prospects rose 18 points to 55%, while their optimism in the economy rose 14 points to 63%
- A net balance of 68% of North East businesses also expect to increase staff levels over the next year, up 19 points on last month
- Overall UK business confidence fell ten points in April to 39%
Business confidence in the North East was the highest of any UK nation or region in April, according to the latest Business Barometer from Lloyds.
Companies reported higher confidence in their own business prospects month-on-month, up 18 points at 55%. When taken alongside their optimism in the economy, up 14 points to 63%, this gives a headline confidence reading of 59% (vs. 43% in March).
A net balance of 68% of businesses in the region also expect to increase staff levels over the next year, up 19 points on last month.
Looking ahead to the next six months, North East businesses identified their top target areas for growth as introducing new technology (55%), investing in their team, for example through training (53%) and entering new markets (38%).
The Business Barometer, which surveys 1,200 businesses monthly and which has been running since 2002, provides early signals about UK economic trends both regionally and nationwide.
National picture
Overall, UK business confidence fell ten points in April to 39%.
Firms’ optimism in their own trading prospects dropped seven points to 50%, while their confidence in the wider economy fell 13 points to 28%.
The West Midlands (53%) and the North West (52%) followed the North East with the second- and third-highest confidence readings.
Sector Insights
Confidence fell across the four broad sectors. Manufacturing confidence remained broadly unchanged from last month, falling by one point to 38%, while the construction sector saw the largest decrease in business confidence this month, declining 22 points to 26%. Retail confidence also fell by 13 points down to 45% and the service industry fell seven points to 40%, both now at three-month lows.
Martyn Kendrick, regional director of the North East at Lloyds said: “Longer days have brought about a brighter outlook from North East businesses, with the region’s businesses leading the UK in business confidence for a second time this year.
“As local firms look to build on this outlook, we’ll continue to be providing our support – whether that’s helping them make new investments their people, premises or products or providing insight to help them shape their strategies.”
Hann-Ju Ho, Senior Economist, Lloyds Commercial Banking, said: “With the announcement of global tariffs from the United States on 2nd April and the market volatility that followed, it is unsurprising that business confidence saw an impact this month.
“However, economic optimism remains higher than at the beginning of the year, showing businesses’ resilience in the face of recent challenges and overall confidence is still well above the long-term average of 29%, an average taken from over 20 years of analysis.”