North East firms maintain hiring plans as confidence slips

North East business confidence saw a double-digit drop in December, according to new figures.

Overall confidence slipped 15 points to 15% in the latest Business Barometer from Lloyds Bank Commercial Banking.

The report, published this morning (December 21), also recorded a 15-point decrease in firms’ confidence in their business prospects, at 20%, and a 16-point fall in economic optimism, at 9%.

Despite this, hiring intentions remained stable in the North East. A net balance of 18% of companies in the region expect to take on more staff in 2019, down by one percentage point compared to November’s findings.

Nationally, overall confidence was only slightly higher than in the North East at 17%, down seven points.

Lloyds’ regional director for the North East, Kelly Green, said: “This month’s drop in confidence is reflected across the country, perhaps a result of businesses anticipating the challenges that lie ahead in the months to come.

“Factors such as the recent fall in the value of the pound may have presented hurdles for businesses, including those North East manufacturers that rely on the import of raw materials, while exporters may have been affected by slowing demand globally.”

She continued: “Despite the fall in confidence, it’s encouraging that hiring intentions have remained relatively stable, and are now higher than the UK average. This suggests these plans are resilient and that firms plan to invest, even amid uncertainty.”

London businesses were the most confident at 32%, followed by the West Midlands (27%) and Wales (20%). Scotland-based firms were the least confident, at -9%.

Lloyds’ Business Barometer collects the views of 1,200 companies every monthly and provides early signals about UK economic trends both regionally and nationwide.