East businesses become more upbeat - while confidence falls in other UK regions

Lloyds Bank's Business Barometer showed the East running counter to all other UK regions - which were less upbeat compared to the previous month.

Business confidence in the East was boosted by 17% to stand at 31% overall - making it the only region to record a higher reading month-on-month.

The region's businesses eyeing growth opportunities through diversifying into new markets (41%), evolving their offer (30%) and launching new tech (27%), the study found.

Trevor Bissett, managing director of Caps Cases, a packaging manufacturer based in Newmarket, said companies in East Anglia were looking to focus on what they could control.

“There’s no shying away from it – it’s been a tough first six months of the year. But many businesses in the region – including ourselves – are becoming more pragmatic. The challenges that we’re all facing are out of our hands, so instead we’re focusing on the aspects we can control in order to put our best foot forward," he said.

“Largely, this is looking at how we can add value and invest in relationships with our customers, making sure that we fully understand the issues they’re facing and how we can best help them overcome these. This sort of agility to adapt operations and support customers in new ways is likely what’s helping firms in the East to become more confident.”

The North West - now the most optimistic region - saw its confidence fall by two points to 42%,in the Lloyds survey.

The regions to see the biggest decreases were London - where confidence fell 28 points to 35%. The West Midlands was down 23 points to 30% and Scotland saw a 15 point fall to 27%.

Contrary to the trend in East Anglia, across the board in the UK, confidence fell 10% to stand at 28% in the UK, the study found.

The survey questions 1,200 businesses every month with the balance of positive and negative responses providing an early indicator of UK economic trends.

It found that East of England companies were more optimistic month-on-month about the economy - up 13 points to 25%, while they were also more upbeat about their own prospects - up 22 points to 37%. This provide an overall headline reading of 31%.

They identified growth opportunities such as diversifying into new markets (41%), evolving their offering (30%) and introducing new technology (27%) - and a net balance of 26% of them expect to increase their workforce over the next year - a 13-point increase.

Meanwhile, across the UK, firms’ optimism in the economy dropped 12 points to 21%, while their outlook on their future trading prospects was down eight points, at 34%. The net balance of businesses planning to create new jobs dropped by nine points to 28%.

Lloyds Bank Commercial Banking regional director Dene Jones (Image: Lloyds Bank)

Lloyds Bank Commercial Banking regional director Dene Jones said: “The rebound in confidence we’ve seen this month is testament to the ability to pursue growth despite current headwinds. While increasing energy prices may have caused discomfort for many firms, sustainable energy looks set to be the source of growth for the region’s economy.

“Further progress on investment for Suffolk’s Sizewell C in the coming weeks, alongside proposals for the East to become a hub for hydrogen technology, puts businesses at the heart of new opportunity to drive a greener economy. Ensuring strong cash flow and investing in talent means firms can be proactive about capitalising on growth, and we’ll continue to be by their side to help the region prosper.”

The survey's sector breakdown showed confidence among UK businesses in the manufacturing and construction sectors falling to 32%. Service sector confidence declined to 25%, while confidence in retail businesses edged up four points from 27% to 31%.