London Tops UK Business Confidence Rankings in November

Highlights

• London records the highest business confidence in the UK, reaching 57% in November.
• Firms in London report increased optimism in their trading prospects, rising to 70%.
• Employment growth is a key focus, with 53% of London businesses planning to expand staff levels.

London's Business Confidence Soars in November
 London led the UK in business confidence during November, according to Lloyds Bank's latest Business Barometer. The capital posted a headline confidence reading of 57%, edging out October’s 56% and securing the highest regional confidence level for the month.

While economic optimism among London businesses declined five points to 45%, confidence in their own trading prospects surged by eight points to 70%. This combined performance underscores London’s resilience and its strong outlook for future growth.

A net balance of 53% of firms in London also plans to expand their workforce over the next year, reflecting a robust intent to build capacity.

Key Areas of Focus for London Businesses
 Over the next six months, businesses in London have identified three primary growth areas:

• Team Development Investing in skills and training, highlighted by 45% of respondents.
• Market Expansion Exploring opportunities in new markets, with 39% targeting diversification.
• Innovation Evolving products and services, as noted by 36% of businesses.

These priorities signal an active approach to strengthening operational capabilities and seizing new opportunities.

National Trends Resilience Amid Economic Concerns
 Across the UK, overall business confidence dipped slightly to 41% in November, down three points from October. Despite this decline, the figure remains well above the long-term average of 29%.

Confidence in individual trading prospects improved nationally, rising two points to 55%. However, optimism about the broader economy fell by nine points to 26%, reflecting mixed sentiments about the macroeconomic environment.

The West Midlands followed London as the second-most confident region, posting a 51% confidence rating.

Sector-Specific Insights

• Manufacturing Confidence in trading prospects rose for the first time in four months, with the net balance climbing three points to 49%.
• Construction Business growth outlooks improved, with a six-point increase in the net balance to 56%.
• Services Continued strength in trading prospects, with a net balance up four points to 61%.
• Retail Softer prospects persisted for a second consecutive month, with trading confidence dropping six points to 45%.

These variations highlight how sectors are navigating the challenges and opportunities within the current economic landscape.

Comments from Lloyds Bank Leadership
 Kirsty Sadler, regional director for London at Lloyds, expressed optimism about the capital’s robust performance:
 “It’s encouraging to see businesses in the capital so confident as we come to the end of the year and look ahead to 2025. We’ll continue to support businesses as they explore new opportunities and navigate busy periods, especially in hospitality and retail.”

Hann-Ju Ho, Senior Economist at Lloyds Commercial Banking, noted the mixed views about the economy while emphasizing the resilience of businesses:
 “In November, the overall confidence metric fell for the third consecutive month. While this reflects tempered views on the economy, businesses remain resilient, with hiring intentions holding steady and a positive outlook on individual trading prospects.”

 London's businesses are showcasing resilience and optimism, even amidst broader economic uncertainties. With a strong focus on growth and innovation, the capital continues to set a confident tone as the UK’s economic landscape evolves. Nationwide, businesses remain cautiously optimistic, balancing economic challenges with opportunities for growth and adaptation.