Lloyds Bank’s Business Barometer for June 2017 shows:
- Economic optimism fell by ten points to 18%, the lowest level for 5 months
- Overall business confidence increased by three points to 30%
- Confidence in business prospects increased by 16 points to 42%
- Firms’ intention to hire rose significantly by 15 points to 34%
Overall business confidence increased by 3 points to 30% in June, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
*Just over half (57%) of this month’s survey responses were gathered after the result of the election with the remaining 43% captured before the election. Confidence based purely on post-election responses was 21% - the lowest level since August 2016. Confidence based solely on responses captured before the election was 40%. Overall, this resulted in an average for the month of 30%.
Economic optimism fell by 10 points from 28% to 18%, the lowest level since January. The share of firms citing greater economic optimism fell by 4 points to 45% from 49%, while the share reporting lower economic optimism rose by 6 points to 27% from 21%.
The net balance of firms indicating an improvement in their own business prospects increased by 16 points to 42%, in June. Fifty percent reported stronger business prospects, up 11 points from 39%, while 8% reported weaker prospects, down by 5 points from 13% in May.
Consumer services confidence fell significantly by 31 points to 14%, while business services confidence rose by 10 points to 38%. Sentiment in the industrial sector increased by 27 points to 33%.
The net balance of firms expecting to raise their headcount over the coming year remained positive, increasing by 15 points to 34%. The share of firms expecting to increase their headcount increased by 13 points to 36%, while 2% expect to reduce staffing levels, down by 2 points from last month.
Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, commented: "Business confidence was mixed in June, given the uncertainty following the election result. Nevertheless, our survey results for Q2 overall suggest that the economy continued to expand, albeit at a pace slightly below that in the second half of last year."