Business Confidence Increases

The Charterhouse Business Confidence Index rose 2 points in quarter 1 this year, from 56 to 58. Although the scale of the increase is unspectacular, it is the first time in nearly two years that confidence has increased across the board among all sizes of businesses in Britain, namely new startups, established small businesses with up to £1m turnover and also larger businesses with annual sales between £1m and 1bn.
Similarly, it is the first increase in confidence seen at all from start-ups during this time, from 56 to 57.
As has often been the case since the survey’s inception in 2011, it is larger businesses with annual sales of over £1m who are the most positive, with an index score of 61. In addition to the aforementioned 57 for start-ups, established small businesses are currently generating a confidence score of 58.
Geographically, five out of six GB regions showed improved confidence, the exception being the heartland of Midlands and the East where confidence remained unchanged. The 3-point increase seen in London, where confidence has been hardest hit since the referendum, represents the first increase in 5 quarters.
In terms of industry sector, Construction continues to be most bullish, increasing a further 3 points this quarter to stand at 65, some four points clear of the Production sector in second place.
Commenting on the findings Mark Dennis, Director of Charterhouse Research, said “The up and down pattern of business confidence seen over the past five quarters has continued this quarter, however it’s encouraging to finally see an improvement, albeit slight, among newly established businesses. Looking ahead to quarter 2, we’ve seen that uncertainty generated by an upcoming election or referendum usually impacts negatively on sentiment, so it will be interesting to see whether the announcement in April of a snap General Election on 8 June has a similar effect.”