UK business confidence returns to pre-Brexit vote level
UK business confidence bounced back to pre-EU referendum vote levels during September, with organisations noting increased optimism for both the UK economy and their own prospects over the coming year according to data from Centre for Economics and Business Research (CEBR).
UK business confidence has returned to pre-Brexit vote level according to the study
The data also shows that for the first time since Britain decided to leave the EU, over half of businesses are feeling positive about their own prospects.
The Economic Index was released today (7 October), it uses a scoring system to measure confidence levels of British Businesses, noting that a reading above 100 indicates positive business sentiment. For the most recent month, this figure sat at 112.4. In the immediate aftermath of Brexit the number was ranked at 105.
This would place business confidence at around the level it was ahead of the Brexit vote. In June it was at 112.6 and in May it stood at 112.5.
YouGov, meanwhile, interviewed 500 organisational decision-makers and found that the greatest increase in business confidence came from organisations’ greater optimism about the UK economy over the next 12 months.
There was a nine percentage point increase in the number of businesses that are optimistic about the UK economy over the coming year (up to 44 per cent in September from 35 per cent in August). Meanwhile, there has been a ten percentage point decrease in the number of businesses that are pessimistic about the country’s economy in the next 12 months.
Additionally, for the first time since the referendum, a majority of businesses said they felt positive about their own performance in the next year.
"It is now clear that business confidence took a short-term stumble in the wake of the EU vote instead of a long-term fall. The panic that gripped businesses in the aftermath of the referendum has subsided and they are now much more level-headed and optimistic about the future of both their own organisations and the UK’s economy in general," said Scott Corfe, director at the Centre for Economics and Business Research.
“Not only has optimism grown but our figures also show that pessimism has decreased, although it is still above pre-referendum levels, indicating the Brexit vote has left longer-lasting scars on some businesses. However, it should be noted that this research was carried out before the Conservative Party conference and all the talk of ‘hard Brexit’ implying that the UK would prioritise immigration restrictions over access to the European single market. Once the shape of our economic relationship with the EU becomes clearer, these figures could shift notably," he finished.
When the EU referendum result was announced several big names in the advertising industry like Sir Martin Sorrell emerged to express their concerns over the future. Once the initial jitters subsided, other industry leaders including Pete Markey, brand communications and marketing director at Aviva, said the outcome provided both a "challenge and an opportunity," for marketers.
Just last month the UK government announced it was launching an inquiry to examine what impact the UK's vote to leave the EU will have on the creative industries.