Business confidence in the East of England fell by one point during May to 55%, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies in the region reported higher confidence in their own business prospects month-on-month, up six points to 61% – the second highest reading in the UK after the South East of England (62%). However, when taken alongside firms’ optimism in the economy, down nine points to 49%, this gives a headline confidence reading of 55% (vs. 56% in April).
A net balance of 42% of businesses in the region also expect to increase staff levels over the next year, up nine points from April.
Looking ahead to the next six months, businesses in the East identified their top target areas for growth as evolving their offering (47%), introducing new technology (32%) and entering new markets (27%).
The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide. The data for this edition was collected between 1–16th May, before the UK general election was announced.
National picture
In May, overall UK business confidence reached its highest level since 2015 – rising by eight points to a net balance of 50%.
Businesses showed increased optimism in both their trading prospects (up nine points month-on-month to 54%) and the economy (up seven points to 46%). Firms’ trading outlook was the most optimistic in seven years, while economic optimism was the highest recorded since September 2021.
Scotland and the South East of England were the most optimistic of the UK nations or regions in May (both 57%), followed by the West Midlands (56%).
Sector Insights
Similarly, there were particularly strong results reported in the construction and services sectors this month. Prospects in the construction sector jumped to 58% (up 20 points), the highest for 14 months, while in services, expected output increased to 57% (up 12 points). On the latter, it is the highest level since the survey was expanded in 2018. Expected business activity in the retail sector also improved to 49% (up three points).
Although trading prospects in manufacturing eased slightly to 49% (down three points), the underlying trend over the last three months remains positive.
