Companies in the West Midlands reported higher confidence in their own trading outlook month-on-month, up 13 points at 66 per cent.

When taken alongside their optimism in the economy, up 33 points to 73 per cent, this gives a headline confidence reading of 69 per cent (vs. 47 per cent in August 2026).

A net balance of 54 per cent of businesses in the region expect to increase staff levels over the next year, up 21 points on last month – a substantial uplift reflecting strong growth intentions.  

Business confidence in the West Midlands still sits above the 12-month average of 53 per cent, with September’s figure of 69 per cent being its highest of this year.

Looking ahead to the next six months, more than half (54 per cent) of West Midlands firms plan to introduce new technology such as AI or automation – the highest proportion of any region, while 47 per cent intend to evolve their offering through new products or services. More than a third (37 per cent) are targeting new markets and investment in sustainability (35 per cent).

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.

Graham FitzGerald, regional director for the West Midlands at Lloyds, said: “It’s encouraging to see such a significant uplift in West Midlands business confidence this month, and the various ways in which firms are looking to channel this momentum.

"More than half are planning to introduce AI and automation, they're expanding their teams, and they're investing in new products and markets. The region is also leading the way on technology adoption.

“We’re committed to making sure West Midlands businesses have access to the support they need to make their growth ambitions a reality."

Overall, UK business confidence fell 12 points to 41 per cent in September, the lowest level since April 2025.

This decline follows August’s reading of 53 per cent, the second highest recorded this year, and buoyant results since May. While confidence remained well above the survey’s long-term average of 30 per cent, it was six points below the 12-month average of 47 per cent.

The overall 12-point decline, which was comparable to the fall recorded earlier this year following the start of the Middle East conflict, was driven by a fall in economic optimism, as businesses responded to higher energy prices as a result of renewed tensions in the Middle East.

Businesses’ own trading outlook declined eight points to 50 per cent, compared to a 12-month average of 56 per cent.

The majority of businesses (57 per cent down nine points from August) expect an increase in output over the year ahead, while those expecting a decrease in activity reduced by one point to 7 per cent.

Among firms expecting weaker activity, the main drivers were economic uncertainty, higher cost pressures and weaker customer demand.

Amanda Murphy (pictured), CEO for Lloyds Business and Commercial Banking, said: “While confidence among larger firms remains strong, smaller businesses have seen a fall in sentiment as they continue to navigate higher costs, inflationary pressures and global uncertainty.

“Overall confidence remains above its long-term average, and most businesses still expect activity to grow over the coming year, underlining the resilience of UK firms. Ensuring smaller firms can share in future growth will be crucial in the months ahead."