Firms from across the region are experiencing an end-of-year confidence boost, according the latest research from Lloyds Bank Commercial Banking.
The bank's Business Barometer survey took feedback from 100 North East businesses between the end of November and mid December, and found confidence rose 24 points to 34%. Regional companies reported higher confidence in their own business prospects month-on-month, up 31 points at 41%. And their optimism in the economy increased 14 points to 25%.
The findings pointed to stronger hiring intentions with 34% of firms expecting to grow their workforces - a 21 point increase on last month. Decision makers signalled their priority areas over the next six months to be investing in teams (45%), evolving their offering (28%) and investing in sustainability (28%).
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It comes after several months of downbeat sentiment found through similar questioning of firms. All UK regions and nations reported a positive confidence reading in December - the first time since July - with eight of 11 recording a month-on-month increase in confidence.
Nationally the manufacturing sector stopped a six-month trend of falling confidence while construction and services firms both increased nine points to give confidence readings of 29% and 18% respectively. Meanwhile retail indicators fell by two points to 13%.
Steve Harris, regional director for the North East at Lloyds Bank Commercial Banking, said: "Businesses in the North East have shown real resilience this year and their current confidence levels both in their own trading prospects and the wider economy suggest a cautious optimism about the coming months.
"With companies eyeing up more investment in their teams through training and new hires 2023 could bring with it a boon for new skills and jobs in the region. Couple this with plans for greater investment in sustainability and it paints a hopeful picture for the region which no doubt has its sights set on growth."
Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said: "Business confidence has received a boost in the run up to Christmas as firms anticipate a better festive trading period than last year. While firms report being hopeful for a more successful 2023, inflation and the risk of an economic downturn remain the biggest concerns for businesses, with rising costs evidenced by the number of firms expecting to raise prices.
"Wage growth is expected to remain high for now as retaining existing staff and attracting new talent will continue to be priorities for many businesses going into next year."
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