China’s economic slowdown, geopolitical tensions in the European neighbourhood and implications of the refugee crisis have contributed to a downturn in business confidence in Europe’s advertising and marketing industry, a new report has found.

According to the European Advertising Business Climate Index, which is based on monthly data from across Europe, business confidence has fallen from +16 to +5 since July across the EU on average.

Every month, companies are asked to fill in a standardised questionnaire answering different sets of questions with a simple scale of responses: ‘increase’ (+), ‘remain unchanged’ (=) and ‘decrease’ (-).

The balances shown are obtained after a percentage of negative answers is subtracted from a percentage of positive answers.

Business confidence is lowest in Greece at -25, followed by the UK at -10.7, which has fallen from +28.6. Confidence is shown as highest in Germany at +27.

The downward trend was also observed in the second quarter, when average confidence dropped from +14 to +5.

However, the advertising industry had a positive quarter for employment evolution, up from +5 to +13, despite employment expectations dropping from +3 to zero from Q3 to Q4.

The report also showed a pessimistic view with regard to demand on European advertising services and optimistic expectations for firm’s employment in the coming months.