Strong start to 2014 as growth raises optimism

CONSUMER confidence has ballooned over the past 12 months, with positive sentiment about the housing market nearly doubling from the beginning of last year.

Lloyds’ spending power report for December, released today, says that the number of people with positive perceptions about the housing market has risen from 23 per cent at the end of 2012 to 41 per cent last month.

Perceptions of the UK’s employment situation have also improved considerably over the year, as the unemployment rate has declined. Some 29 per cent of respondents now say that the job market is “not good at all” in comparison to 42 per cent 12 months ago.

“Despite confidence about the UK’s economic situation almost doubling, there is still little change in sentiment towards consumers’ personal financial situation over the past 12 months,” added Lloyds’ director of personal current accounts Philip Robinson.

In December 2012 48 per cent had a negative view of their own financial situation, falling to 46 per cent by the end of last year.

According to separate research released today, the number of firms in critical financial distress is falling as the recovery continues.

Restructuring firm Begbies Traynor says that four per cent fewer firms had critical problems in the fourth quarter of 2013, in comparison to the same three months the year before.

Financial services are looking particularly healthy in comparison to other sectors, with a 21 per cent decline in companies suffering from major stresses to their business.

Despite the decline in the most serious category of financial distress, the same twelve month period saw a rise in enterprises with “significant problems”, which are up by 16 per cent.

“As is common at this stage of any recovery process, businesses with inexperienced management teams or limited credit availability are simply unprepared to step up a gear and fund and executive the business strategies required to remain competitive,” said Begbies Traynor partner Julie Palmer.