Confidence in financial and job security is at the highest level since records began, according to a poll by IHS Markit.
The poll has shown how households’ optimism over their finances and the economy has grown in February, which is likely due to Boris Johnson’s election victory back in December. Consisting of 1,500 responses, the IHS Markit household finance index reveals the UK’s perceptions of financial wellbeing rose from 44.6 in January to 47.6 this month.
The Guardian has reported that in the 11 years since the financial crash, the index hasn’t exceeded 50.0 (which is the level that indicates improving conditions), and that the new figures suggest financial conditions have become less challenging in the UK. The future household finance index (different to the household finance index mentioned above) is used to monitor early warning signs about the economy. However, with the boost from 49.6 to 52.7 in consumer trust with the UK’s financial market, it could pave the way for increased spending after one of the toughest years for high-street retailers.
If the predicted boost in consumer spending does come to fruition, it’s not just the retailers that would benefit. The hospitality, automotive, home improvement and other industries would also likely see an uptake in custom, due to consumers being more likely to part with their money if they feel confident in the stability of the UK financial market.
This trust and confidence may also mean increased competition for local businesses, this is because the number of new small or medium-sized enterprises (SME’s) seems to be increasing as consumer confidence increases (Merchant Savvy, 2020). Even though the saying goes ‘a bit of competition never hurt anyone’, there’s no harm in stabilising your position in the market, or even growing your presence, to alleviate any potential drop made by increasing competition.
Increasing marketing efforts can assist with generating greater awareness and driving new leads to your business. Whether that’s through search engine optimisation, social media advertising, search engine advertising, display advertising or any other method of getting your business out there to the audience you want to focus on, there are a number of routes to take to lessen the impact new competitors have on your business.
It probably is worth a mention that although the survey does indicate how some UK households feel about the current economic climate, it is only a small sample of people in the grand scheme of things. We also don’t know much about their job role or income, how many people they financially support, or location they’re from, as these could all be variables that have an effect on responses.