Welsh business confidence jumps to eight-month high, as more firms plan to hire

Business confidence in Wales rose to its highest level in eight months in March, according to the latest Business Barometer from Lloyds.

Companies in Wales reported higher confidence in their own business prospects month-on-month, up 25 points at 56%. When taken alongside their optimism in the economy, up 27 points to 45%, this gives a headline confidence reading of 51% (vs. 24% in February) – the country’s highest level since July 2024.

A net balance of 33% of businesses in Wales also expect to increase staff levels over the next year, up 13 points on last month.

Looking ahead to the next six months, Wales businesses identified their top target areas for growth as investing their team, for example through training (53%), investing in sustainability (34%) and evolving their offer, for example, by introducing new products or services (32%).

The Business Barometer, which surveys 1,200 businesses monthly and which has been running since 2002, provides early signals about UK economic trends both regionally and nationwide. This data was gathered between the 3rd – 17th March, ahead of the Spring Statement.

National picture

Overall, UK business confidence was 49% in March – the same as in February.

While firms’ optimism in their own trading prospects held steady at 57%, their confidence in the wider economy dropped one point to 40%.

The West Midlands and London were the joint most-confident of any UK nation or region in March (both 62%), followed by the North West (59%).

Sector Insights

Retail confidence rose seven points to 58%, a post-pandemic high, reflecting positive trading prospects.

In contrast, the manufacturing sector saw the largest decrease in business confidence this month, declining 12 points to 39%, due to increased concerns about supply chain disruptions. Construction firms also saw a decline to 48% and businesses in the service sector saw confidence decline to 47%.

Dave Atkinson, regional director for Wales at Lloyds, said: “The changing of the seasons is also bringing a sunnier outlook for Welsh businesses.

“It’s particularly good to see firms so optimistic in their own prospects. As they look to capitalise on their confidence, we’ll be ready with our support to help them make the most of any opportunities ahead. This includes discounted lending to support investments in measures that improve environmental impact – something central to many Welsh firms’ growth plans.”

Hann-Ju Ho, Senior Economist, Lloyds Commercial Banking, said: “Business confidence remained steady this month, suggesting that UK companies may have been waiting to see the impact of government decisions at home and globally. Despite this, today’s data continues to reflect a positive growth trend in the UK economy. With confidence maintaining last month’s high, business leaders are optimistic, noting that investing in their development and workforce will position them well to seize future growth opportunities.”