Business confidence in Yorkshire fell 16 points during April to 41%, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies in Yorkshire reported lower confidence in their own business prospects month-on-month, down nine points at 51%. When taken alongside their optimism in the economy, down 25 points to 29%, this gives a headline confidence reading of 41%.
Despite the fall, Yorkshire businesses remain the second most confident in the UK, in line with March’s findings. Firms flagged a range of growth opportunities for the next six months, including diversifying into new markets (39%), investing in their team (34%), and evolving their offer (34%).
The Business Barometer, which questions 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide.
A net balance of 41% of businesses in the region expect to increase staff levels over the next year, down 19 points on last month.
Overall, UK business confidence remained unchanged during April, at 33%. Firms’ outlook on their future trading prospects rose five points to 39%, but their optimism in the economy dipped slightly on March’s reading (down from 32% to 26%). The net balance of businesses planning to create new jobs also decreased by six points to 26%.
Every UK region and nation reported positive confidence readings in April. Wales (up 25 points to 20%), the South East (up 19 points to 30%) and the West Midlands (up 10 points to 42%) reported the largest increases month-on-month, with the West Midlands now the most optimistic region overall.
Steve Harris, regional director for Yorkshire at Lloyds Bank Commercial Banking, said: “With businesses facing such significant global pressures, it was inevitable that we would see a drop-off in confidence this month. But since the start of the pandemic, we’ve witnessed the incredible resilience of firms across Yorkshire. The figures clearly show that they are continuing to focus on growth as they weather ongoing macro-economic challenges.
“Taking advantage of opportunities to invest in their teams and tap into new markets is helping business optimism. This careful planning will be key to maintaining growth prospects in the months ahead.”
From a sector perspective, manufacturing confidence increased by eight points to 43%, erasing part of the 19-point decline in March, helped by somewhat stronger trading prospects.
Retail and services confidence, however, were little changed on the month and is weaker than at the start of the year, with businesses increasingly concerned about the outlook for the wider economy. Retail confidence edged up one point to 29%, while services confidence was unchanged at 32%. Construction confidence fell for a second month to 33%, but is still on a par with the all-sector average.
Hann-Ju Ho, senior economist, Lloyds Bank Commercial Banking, said: “April’s data is mixed and follows the significant decline in business confidence in March after Russia’s invasion of Ukraine. Although firms reported a partial recovery in their trading prospects, optimism for the wider economy declined for a second successive month.
“Positives remain as overall confidence is above the long-term average, but it is still expected that growth will moderate over the coming months and many businesses will remain cautious as they face into these headwinds.”
