March sees sharp fall in business confidence in the region

The research, taken between March 2 and 16, showed that companies in the region had lower confidence in their business prospects at 10 per cent and lower economic optimism at seven per cent. Together, this gives an overall confidence of nine per cent.

Across the UK, overall business confidence fell by 17 percentage points to six per cent in March, the lowest level since October 2019. However, the report showed that nationally, for the second week of the survey, a much sharper fall in overall confidence was recorded at minus three per cent. It matches the lowest dip seen by the barometer since December 2011 and is otherwise the lowest dip since March 2009 during the global financial crisis.

Responding specifically to the impact of coronavirus, 74 per cent of West Midlands businesses stated that they had already been affected or expected to be impacted, ahead of Boris Johnson’s initial call for the public to stay at home on March 16. The data illustrates the impact that the outbreak was having on business confidence before many initiatives launched by the Government to help combat the virus were announced.

The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.

Tough

Amanda Dorel, regional director for the West Midlands at Lloyds Bank Commercial Banking, said: “It’s clear that the impact of the virus was being felt by West Midlands’ businesses before the social distancing measures were announced by the Government, with nearly three quarters of businesses in the region saying they’d already been or expected to be impacted by the outbreak. Against this backdrop, we can expect a more bearish picture in the region next month as tough trading conditions weigh on businesses’ outlook.

“We are here to help our customers through interruptions they may face and as part of our anticipated £18 billion of support for businesses this year, we’ve set aside £2 billion of arrangement fee free finance to help small firms affected by Covid-19.

“This funding is designed to help businesses manage their cashflow, which might have been affected by supply chain interruptions or employee absences. We’re also advising firms on how they can access the Coronavirus Business Interruption Loan Scheme (CBILS).

“We remain committed to supporting our customers in the weeks and months ahead in any way we can. Only last week, we helped the Bull’s Head pub in Chelmarsh to navigate its way through government support like guarantees and grants and provided a finance package to help sustain the business during this unprecedented time. The pub successfully switched to a takeaway food service, securing jobs for all of its full-time staff, which shows how important it is that we all work together to get through this and help healthy businesses like the Bull’s Head to survive.”