London’s business confidence worse than national average
The continuing fall in confidence in the capital has gathered pace and is now among the worst in the UK.
According to the latest ICAEW Business Confidence Monitor, London’s confidence index now stands at -20.3, nearly four points lower than the national average. This marks a deterioration in sentiment since the previous quarter, when it was three points better than the UK’s overall confidence reading.
London is one of only three regions that have fallen below the UK average in Q1 2019, with the East of England and the West Midlands joining the capital in its downbeat attitude
According to the BCM report, Brexit could be to blame. Of the three regions, London may have a particular vulnerability given its reliance on service sector export sales, while the East of England is more reliant on migrant labour than any other region outside London.
Other key findings for Q1 2019 include:
- Business confidence in the UK fell from -12.3 last quarter to -16.4 this quarter – a further fall in the index.
- A decline in profits in the last year is largely due to slower sales.
- Labour market challenges (staff turnover and the availability of management and non-management skills) are starting to increase.
- Confidence across all sectors is in negative territory apart from IT & Communications. Property and Construction sectors as well as Retail & Wholesale are the least confident.
Michael Izza, ICAEW Chief Executive, said: “As the roulette wheel continues to spin, UK plc is having to place its bets based on best guesswork - and the stakes could not be higher. Companies are making decisions now about jobs, supply chains, headquarters and asset locations, incurring significant, and possibly unnecessary, cost and upheaval.
“We fear the destructive effects of a ‘no deal’ outcome on the economy so urge our politicians to work together to break the Brexit deadlock and help restore business confidence.”
For more details go to ICAEW Business Confidence Monitor.
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