British businesses say 'Bring it on!'

An increase in confidence shows British businesses are turning the corner after a gloomy end to 2005. Cripplingly slow Christmas sales, rocketing oil prices and increasingly cautious consumers all contributed to a five-year low in business confidence at the end of 2005.

However, research undertaken for the Tenon Forum, released earlier this month, shows businesses have fresh faith in their prospects having enjoyed a five per cent increase in confidence in just the past six months.

Since the Tenon Forum's inception in 2002 there has not been such a marked increase in confidence. 2005 saw the lowest levels of confidence this century but, as energy prices have steadied and this year's obstacles have become more tangible, British businesses are declaring their intent to succeed.

The bi-annual research, conducted by GfK NOP on Tenon’s behalf, questioned managing directors, financial directors and senior directors of 500 small and medium-sized businesses.

Most markedly, the UK's construction industry is taking on challenges with a fresh perspective. At the end of 2005, more than a quarter of the construction industry was predicting big problems in 2006. Now, 93 per cent of respondents are making positive business forecasts. No sectors of the UK's industry have suffered a decline in confidence. While financial and business services continue to enjoy steady and high confidence levels, both transport and communications, and retail, utility and leisure are enjoying a ten per cent increase in confidence over last year’s verdict.

The research does, however, record a regional divide in levels of business confidence. While London records a seven per cent increase in confidence and the South West and Wales an incredible 17 per cent growth, the Midlands and the North West have both suffered minor decreases at six and two per cent respectively.