Yorkshire Business Confidence Falls In April

Business confidence in Yorkshire and the Humber fell 26 points during April to 34%, according to the latest Business Barometer from Lloyds Bank Commercial Banking.

Companies in Yorkshire and the Humber reported lower confidence in their own business prospects month-on-month, down 36 points at 34%. When taken alongside their optimism in the economy, down 16 points to 34%, this gives a headline confidence reading of 34% (vs. 60% in March).

Yorkshire and the Humber businesses identified their top target areas for growth in the next six months as evolving their offering with new products and services (49%), introducing new technology (42%) and investing in their team, including hiring new people and investing in training (32%).

A net balance of 21% of businesses in the region also expect to increase staff levels over the next year, down 27 points on last month.

The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide.

National picture

Overall UK business confidence held steady at 42% in April, the same level as recorded in March and February.

While firms’ confidence in their own prospects dipped marginally by four points to 45%, their confidence in the economy rose by four points to 39%. Meanwhile, the net balance of companies planning to increase staff levels over the coming 12 months climbed six points to 33%.

The East of England was the most confident UK nation or region in April (56%), followed by the Wales (51%) and the North East (46%).

Sector Insights

Businesses in the manufacturing sector reported increased confidence this month, recording an increased score of 45% (up 4 points) which is the highest level for 3 months. Similarly, confidence among firms in the services sector (42%) and construction (41%) also improved, largely driven by greater economic optimism.

In retail, confidence pulled back slightly from last month’s strong showing to 40%, illustrating that confidence in this sector remains fragile. Retail is also more liable to be impacted by external factors sectors other sectors do not face into, such as the poor weather.

Martyn Kendrick

Martyn Kendrick, regional director for Yorkshire and the Humber at Lloyds Bank Commercial Banking, said:

“While confidence has fallen this month, Yorkshire businesses are still more confident than they were this time last year – a clear indication that firms are forging ahead despite a complex and fast-moving environment.

“Encouragingly, they are also pursuing growth by exploring new products and services and the latest technology, as plans for an investment zone in South Yorkshire start to take hold and present opportunities for the region’s advanced manufacturing sector and its supply chain.

“We’ll continue to be by the side of businesses in Yorkshire and the Humber as they navigate challenges and target growth.”

Hann-Ju Ho

Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking, said:

“We are beginning to see a consistent trend emerge from our Barometer results in recent months. Businesses are feeling increasingly confident about the economy, coinciding with falling inflation and hopes that interest rates will start to fall this year.

“There continues to be a mixed picture among the regions, with the biggest rises seen in Wales and the South West. The strongest confidence was reported in the East of England, with confidence rising for the third consecutive month. Confidence in the North East eased slightly but remained strong in April.

“The second quarter of 2024 has started brightly for businesses, and we are seeing firms expressing greater confidence in an enduring economic recovery.”