More east businesses look to cut jobs as uncertainty dents confidence

A net balance of 8% of firms in the east expect to reduce headcount in the next year, according to L

A net balance of 8% of firms in the east expect to reduce headcount in the next year, according to Lloyds Bank's Business Barometer Picture: DANNY LAWSON/PA - Credit: PA

Business confidence in the East of England fell to its lowest level in more than a year in January with more expecting to cut jobs, a survey has found.

steve elsom, lloyds bank

steve elsom, lloyds bank - Credit: Archant

Lloyds Bank’s Business Barometer for January 2019 showed overall confidence for firms in the East of England slid four points in the past month to 6% - the lowest since the regional barometer report launched a year ago.

A net balance of 4% of firms are now pessimistic about the economy, a 2% fall, but firms’ confidence in their own business prospects was 17%, compared with 27% in December

Businesses’ hiring intentions showed that a net balance of 8% of firms in the region now expect to reduce their headcount during the next year. At the end of last year, 8% expected to create new jobs.

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Nationally, UK confidence rose two points to 19% as firms’ optimism about the economy climbed three points to 10%. Companies’ confidence in their own prospects edged up one point to 27%.

The Business Barometer questions 1,200 businesses monthly, providing early signals about UK economic trends.

Steve Elsom, regional director for the East of England at Lloyds Bank Commercial Banking, said the region’s firms had started off the year on a cautious footing with hiring intentions, confidence in business prospects and optimism about the wider economy all falling.

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“There’s no doubt that companies across the UK are navigating uncertain times, which makes planning ahead hard,” he said. “Firms in the East of England have proven their resilience time and time again and we’re committed to be by the side of businesses whatever the year ahead may bring.”

Regionally, a net balance of 13% of businesses felt the UK’s exit from the European Union was having a negative impact on expectations for business activity, compared with 18% a month ago.

Businesses in London showed the most confidence, at 36%, ahead of the West Midlands (31%) and the South East (23%). Scotland and the North East were least confident, with an overall confidence of just 1%, 18 points below the national average. Construction and manufacturing had the highest confidence at 30% and 28% respectively, while retail (14%) and services sectors (19%) had the lowest.