More than eight in 10 (84%) of private business owners in Yorkshire are confident in delivering growth in the second half of 2026, according to KPMG.
At the start of 2026, KPMG's annual Private Enterprise Barometer surveyed 1,500 privately owned businesses across the UK, including 110 in Yorkshire, spanning sectors such as professional services, financial services, technology, industrial manufacturing and retail, to understand their growth ambitions and priorities for the year ahead.

Six months on, following a challenging period for the UK and global economy marked by instability in global energy markets, persistent inflation and trade restrictions, KPMG returned to these same businesses to understand how changing economic conditions have influenced their outlook.

At the start of the year, 81% of private businesses in Yorkshire expressed confidence in their growth prospects for the next 12 months. By the mid-year mark, this sentiment has grown further, with confidence levels rising to 84%, highlighting the resilience of Yorkshire’s private business community despite continued economic uncertainty.

Investment priorities

That confidence is translating into investment. Technology continued to dominate as a leading investment priority for Yorkshire-based businesses, with 71% identifying areas such as artificial intelligence (AI), cyber security and broader digital transformation as key focuses. This is five percentage points above the UK average (66%) and represents a 32-percentage point increase from 39% at the beginning of the year, signalling a dramatic shift towards investment in long-term productivity and innovation across the region.

Diversification also remains firmly on the agenda. Nearly two-thirds (65%) of respondents are looking to expand their service offerings and broaden their client base, unchanged since the beginning of the year and in line with the national average.

Of businesses considering how to fund their growth plans, 46% are identifying private equity as a way to fund their ambitions – one percentage point above the UK average of 45%. Despite this increase, more than half (57%) of businesses are turning to their own balance sheets to help fund their growth plans, reflecting a growing preference to retain control and rely on internal resources amid ongoing economic uncertainty.

Looking ahead

Despite growing confidence, businesses remain alert to the challenges ahead. 49% of businesses in Yorkshire identified inflation and ongoing cost pressures as the two biggest short-term risks facing their organisations. At the same time, firms are looking to policymakers to help strengthen long-term resilience. When asked about the Autumn Budget, 44% of the region’s firms said that they want to see technology adoption and digital capability prioritised by the incoming Chancellor.

Looking further ahead, the wider economic picture remains front of mind, with more than half (58%) of respondents pointed to the UK’s economic outlook and productivity growth as the biggest external factor shaping decisions around investment, growth and exit planning.

Phil Murden, Leeds Office Senior Partner at KPMG UK, said: “Yorkshire's private businesses are bucking the national trend. At a time when confidence has softened across the UK, firms in our region are becoming more optimistic and, crucially, continuing to invest.

"The standout finding is the strength of Yorkshire's commitment to technology. Businesses here are investing in AI, cyber security and digital transformation at a higher rate than the UK average, reflecting the region's growing reputation as a powerhouse for digital innovation, financial and professional services, and advanced manufacturing. Those investments will be key to unlocking the productivity and competitiveness businesses need for long-term growth.

"Businesses aren't ignoring the challenges. Inflation, cost pressures and economic uncertainty remain very real. But rather than standing still, Yorkshire firms are backing themselves to grow. Now they need the right conditions from the new government to keep investing, build digital capability and turn that confidence into sustained growth."

The national outlook

Nationally, private businesses outlined plans to continue to invest in technology and skills as part of efforts to boost growth after KPMG UK’s mid-year Private Enterprise Barometer revealed a dip in growth confidence due to ongoing UK and global uncertainty.

The survey found that 80% of business owners were confident in their firm’s growth prospects, down from 87% when asked earlier this year.

Overall, technology, including AI, remains the main investment priority signalling this is now shifting towards practical implementation of tech like AI to improve productivity, efficiency, and growth.

Looking ahead to the Autumn Budget, private businesses said the areas most in need of attention to help bolster growth are the faster adoption of new technology and boosting digital capability, growth-focused investment and the continued focus on a renewed industrial strategy.

Euan West, Head of KPMG Private Enterprise in the UK and EMA, said: “2026 has continued to present private businesses with a challenging operating environment, shaped by uncertainty both at home and abroad.

“Against that backdrop, it is encouraging that eight in 10 business leaders remain confident about their growth prospects. While confidence has eased since the end of last year, the overall picture remains one of resilience and determination.

“What stands out most is how private businesses are responding. Rather than pulling back, they are investing in skills, technology and the capabilities that will help them remain competitive and unlock future growth.

“These results highlight a business community that is realistic about the challenges ahead but confident in its ability to overcome them.

“Private enterprise leaders are entrepreneurial, action-oriented and focused on what they can control. They are not waiting for conditions to improve; they are getting on with the job of creating growth.”