With 2014 quickly fading from the memories of businesses across the UK, most executives will be looking to the year ahead and setting targets for commercial growth and revenue increases in 2015. Fortunately, the foundations laid last year appear to have had a positive effect upon the outlook of companies, with a number of recent surveys showing a high percentage of British bosses are very optimistic about their prospects for 2015.
In the most recent study conducted by Lloyds Banking Group, a net 43 per cent of the 1,500 business leaders questioned revealed that they expect their sales, orders and profits to grow during the next 12 months. While this is a slight drop from the 53 per cent recorded last July, which represented a 22 year high, it is significantly stronger than the long term 30 per cent average and indicates a growing resilience within the UK economy.
Moreover, the survey found that a net balance of 20 per cent of participating businesses intend to continue 2014’s trend of upping staff numbers in order to maintain their levels of growth during the economic recovery. This is the second highest reading taken since the survey began, and is extremely good news in terms of the UK’s continuing drive to lower long term unemployment statistics.
Lloyds’ chief economist Trevor Williams believes that the ongoing issues surrounding exporting may have caused the 10 per cent drop in business confidence since July.
He says; “Disappointing economic news from the Eurozone and concerns about the momentum in global growth have undoubtedly contributed to lower business confidence for this survey.
“However, the fall in oil and other commodity prices will help ease cost pressures and, by boosting consumer incomes, help support economic growth.
“Continued employment growth in the UK also bodes well for domestic demand.”
Given the concerns over the Eurozone, therefore, it is hardly surprising that the level of business confidence expressed by CEOs varied hugely on a sector to sector basis. Bosses at firms in areas such as transportation and communications were the most confident, with business services following closely behind.
At the other end of the scale lay manufacturers and construction firms who expressed worries that the stellar performance of 2014 will not be carried over into the New Year. The Lloyds report predicts that confidence in each of these sectors will slide further over the next six months, with just 44 per cent and 42 per cent respectively forecasting growth in the first half.
This negative outlook was reinforced by research from manufacturing trade body EEF, which found that only 37 per cent of its members expect economic conditions to improve during 2015. This is a huge drop in optimism from the same time last year, when 70 per cent of those surveyed predicted a positive change in fortune for the coming year.
Chief executive Terry Scuoler says; “Manufacturers’ confidence at the beginning of last year was very high – one year on and, while still positive, it has very evidently eased back.
“The realities of 2014 have taken the edge off future forecasts and what we are now seeing as we head into 2015 is a far more muted outlook, tempered by a backdrop of difficulties in the EU and wider geo-political concerns.”
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