Yorkshire Business Confidence Drops Slightly In September

Business confidence in Yorkshire and the Humber fell one point during September to 40%, 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 four points at 35%. This was somewhat offset by increased optimism in the economy generally, which climbed three points to 45% - but this still gives a decreased headline confidence reading of 40% (vs. 41% in August).

Just a net balance of 30% of businesses in the region expect to increase staff levels over the next year, down nine points on last month.

Looking ahead to the next six months, Yorkshire and the Humber businesses identified their top target areas for growth as introducing new technology (43%), evolving their offering by introducing new products or services (39%) and investing in their team, for example, by investing in training and development (35%).

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 in September dipped slightly, to 47% down from August’s 50%.

Though there was a marginal increase in their own trading prospects (up two points month-on-month to 54%), firms’ confidence in the overall economy dropped nine points to 38%.

The joint-most confident regions in the UK were the West Midlands and London, both reporting overall confidence of 59%. Only Northern Ireland, Wales, London, the South West and North West reported an increase in overall confidence.

Sector Insights

Projections for output were mixed across the sectors, with some showing significant changes from previous results. In construction, the sharp increase last month was largely counteracted by a drop in expectations in September, falling by 12 points to 46%.

Similarly, in manufacturing, trading prospects fell for a second month to 53%, although this figure is still stronger than the year-on-year figure. However, the falls in manufacturing & construction sectors were more than offset by a small rise in retail and a bigger rise in the dominant service sector.

Martyn Kendrick

It’s discouraging to see confidence falter among Yorkshire firms, especially after the optimism of August.

However, businesses are set to benefit from the ample investment opportunities available in the area. Sustainability firms are particularly well placed for growth, with a new report by Green Economy finding that companies focused on decarbonisation are set to grow by 37% by 2026.

As always, we’re also on the ground in Yorkshire, understanding the needs of businesses leaders and providing the support they need to keep growing.

Hann-Ju Ho

Although overall confidence fell this month, that fall was from a nine-year high and businesses remain positive about their own trading prospects. The joint-highest result this year could suggest that respondents still see a positive future for their own companies, which is also reflected in the largely unchanged employment figures.
“The more mixed picture for economic optimism points to some businesses maintaining a degree of caution. While we still expect economic expansion, it may occur at a slower rate than the first half of 2024.