Fall in optimism about the economy and business prospects among London firms - CBI / KPMG

Published on Monday, 05 December 2011 10:24
Posted by Scott Buckler

Only 13% of London businesses feel more optimistic about prospects for the economy over the next six months, compared with 43% in June, and optimism about their own business prospects has fallen from 51% to 31% over the same period, according the latest CBI / KPMG London Business Survey

In the latest bi-annual survey of 262 London business leaders, just over half (55%) say their top concern over the next year is the threat of a double-dip recession.

But companies are now less concerned than six months ago about reduced public sector spending which has dropped from second to seventh place. Although half (51%) of firms still think that public sector spending cuts will have a moderate impact on their business (down from 71% a year ago).

The number of companies only hiring when essential has increased from 59% in June to 64% in this survey, with 23% of businesses implementing recruitment freezes, broadly the same as six months ago (20%).

With just over seven months to go until the Olympics, an overwhelming 92% of London businesses think the Games will benefit London internationally, and three-quarters (78%) say they are 'looking forward' to the event.

Sara Parker, CBI London region director, said:

"It's clear that London business confidence has been knocked by the ongoing uncertainty in the Eurozone and weak demand and growth at home. We now need the Government to power ahead with its autumn statement plans to help businesses grow and create jobs.

"Companies are confident that the Olympics will benefit London internationally. The Games will showcase London as a world-leading business location, and highlight the success of UK firms in delivering a complex construction and infrastructure project. Expertise that can be easily exported around the world.

"It's good news that the majority of the capital's companies are now thinking about planning for the Games, but there is still more work to be done over coming months to make sure transport, staffing and security issues are ironed out."

 

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