UK business optimism hits five-year high, so why has London slipped?
Economic optimsim across the UK has reached its highest level in five years, but for some London businesses the buzz of reopening has died down.
Optimism nationally regarding the economy climbed five points to 37 per cent, in the Lloyds Bank Business Barometer, the highest since 2016, while firms’ trading prospects rose three percentage points to 28 per cent.
However, in London business confidence fell eight percentage points during May to 24 per cent.
In terms of a London jobs recovery in the summer the outlook was not overly positive, the firms’ hiring intentions across the capital dipped four percentage points in the past month to seven per cent.
Across the UK, employment sentiment was also better.
Firms’ hiring intentions rebounded to pre-pandemic levels with 14 per cent of British businesses expecting to take on new staff in the next 12 months, the highest reading since February 2020.
Mark Amis, regional director for London at Lloyds Bank Commercial Banking, said: “Overall confidence among London firms has risen significantly since the government announced its four-step roadmap out of lockdown, and despite a slight dip in May, businesses confidence is still high.
“However, we know some businesses are still struggling with reduced operational capacity, and this is especially true for the city’s world-famous restaurant and hospitality sectors.
“Whatever the coming weeks and months hold, we will remain by the side of businesses across the capital to help them emerge from the restrictions in as strong a position as possible.”
The survey was carried out in the run-up to the 17 May further easing of Covid-19 restrictions in England, which limited hospitality to outdoors-only.
Eight out of 12 of the nations and regions measured by Lloyds saw a month on month jump in business optimism, led by Wales whose increase could be down to the reopening there mainly taking place after England.
The muted news for the capital comes a day after another influentia; business survey found optimism over the future of the UK’s dominant service sector increased at the fastest pace on record in the three months to May as the UK’s economic recovery from the pandemic gathered steam.
According to the CBI’s latest quarterly Service Sector Survey, sentiment about the general outlook for the professional services sub-sector jumped from 23 per cent to 63 per cent, a record leap.