The latest Lloyds Bank Business Barometer shows confidence among UK companies is running at its highest level in more than four years.
Data from the bank’s August survey reported overall business confidence at +36%, a six-point increase from the previous month and the highest figure since April 2017. This surge in confidence was driven by improvements in firms’ trading prospects and expectations of stronger growth in the year ahead.
Commenting on the findings, the bank’s Senior Economist, Hann-Ju Ho said, “Business confidence reaching its highest level in over four years tells a positive story about the country’s economic recovery. Staff shortages remain a challenge but as the economy moves back towards pre-pandemic levels, we can be optimistic that the momentum for business confidence and economic optimism can be sustained in the months ahead.”
Another survey published last month also highlighted the issue of staff shortages. The IHS Markit/CIPS composite Purchasing Managers’ Index fell to a six-month low of 54.8 in August, with respondents reporting constraints on business activity due to shortages of staff and raw materials. While any value above 50 still represents growth, the latest reading does suggest the UK recovery lost some momentum over the summer months.