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Business confidence returns to positive territory for first time in three years

Data from the Recruitment & Employment Confederation found that employers are also looking at hiring more staff, but labour shortages remain an issue.

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Business optimism

Business confidence in the UK economy has turned positive for the first time since June 2018, according to new data.

The latest Recruitment & Employment Confederation (REC) Jobs Outlook survey found that employers are increasingly optimistic about the economic outlook as pandemic restrictions have eased.

In the three months to May, confidence has jumped by 21 percentage points to net positive score of 11, the first positive reading in three years and hitting its highest level in nearly five.

The survey’s respondents also recorded a positive score when asked if they were confident in making hiring and investment decisions, at 29 points – the highest level since March 2016.

Neil Carberry, chief executive of the REC, said: “This surge in employers’ confidence in the UK economy is remarkable – an improvement of 61 percentage points from the previous quarter as restrictions were lifted and businesses started to open again.

“Positivity about hiring has steadily improved alongside that, and we are now seeing the highest levels of confidence for five years.

“However, we are seeing labour and skills shortages across the economy right now, which the pandemic has made worse.

“These could threaten to slow down the recovery if not addressed quickly.

“It’s vital that companies and governments come together and improve access to training and support for everyone who needs it, so that jobseekers are able to find work in those sectors that are growing.”

The boss added that more businesses were looking to bring on temporary staff in the coming months to help them re-open.

Around 63% of employers also said they expect no change in their employees’ working location once restrictions are eased, compared to before the pandemic.

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