The South West has seen the biggest fall in overall business confidence in England during the third national lockdown, with many companies pinning their trading hopes for the year on the coronavirus vaccine, a new report has found.
Confidence among South West firms fell into negative territory during January, dropping by 13 points on the previous month to -8%, according to Lloyds Bank Commercial Banking’s Business Barometer.
Only firms in Scotland and Wales reported higher levels of pessimism about their prospects for the year ahead, with 23 and 19-point falls respectively.
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More than two thirds of the 1,200 South West companies questioned said the current lockdown restrictions had caused a fall in turnover.
The Covid-19 vaccination programme appeared to offer hope to almost half of the firms, with 44% saying the rollout of the jab had boosted their confidence for business in 2021.
Yet only 11% of businesses in the region expected trading levels to return to pre-pandemic levels in the next twelve months. Almost a fifth said they expect to reduce staff levels over the next year - up 17 points on December’s data.
David Beaumont, regional director for the South West at Lloyds Bank Commercial Banking, said: “After a challenging festive period, business confidence in our region is now back in negative territory.
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“A third national lockdown is hindering firms’ ability to trade effectively – especially those in the hospitality and tourism sectors that are the lifeblood of the South West economy.
“However, the vaccine rollout appears to have given businesses hope of a return to some level of normalcy this year. We remain firmly by the side of our region’s business community as it navigates an uncertain and challenging environment.”
Improvement in confidence levels was reported in other parts of the country, such as London and the South East, with this month also seeing the implementation of Britain's new trade deal with the EU.
In terms of sectors, confidence among construction companies improved for a second consecutive month, but there were declines in optimism among companies in services and retail.
Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said: “It has been a challenging start to the New Year for 海角视频 businesses adapting to a third national lockdown alongside the new EU trade arrangement taking effect.
“Nevertheless, while confidence remains below average, it is encouraging that business sentiment is still the second highest since the low of May 2020.
“Overall, the vaccine rollout programme has lifted confidence and that will hopefully buoy business optimism in the coming months.”