Business confidence in London fell ten points month-on-month during August, to 37 per cent, with businesses pulling-back on recruitment plans, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies’ hiring intentions fell significantly. A net balance of just 25 per cent of businesses in the capital expect to hire more staff during the next year, down 34 points on July.
London-based firms also reported lower confidence in their business prospects, falling 19 points to 35 per cent, despite economic optimism holding firm at 39 per cent. Both of these figures combined give an overall confidence of 37 per cent, which is ten points below last month’s figure of 47 per cent.
Despite this, London business confidence remained at the joint-highest level in the UK for a second successive month, alongside the West Midlands.
Nationally, overall confidence fell six points to 23 per cent as firms’ optimism about the economy dropped eight points to 17 per cent. Businesses’ confidence in their own business prospects dropped five points to 29 per cent.
The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.
Paul Evans, regional director for London at Lloyds Bank Commercial Banking, said: “Businesses are certainly feeling less confident about their own prospects, and these doubts appear to be affecting job creation.
“However, although this month has been a challenge, business confidence in the capital is the joint-highest in the UK and we have seen London maintain this top ranking fairly consistently throughout 2018.”