Yorkshire and the Humber was home to 40 Foreign Direct Investment (FDI) backed projects in 2021, according to the 2022 EY Attractiveness Survey.
The region’s 2021 performance was down on both 2020 (55 projects) and 2019 (59), although key sectors, including the digital technology sector, did see an improvement in performance from the previous year. By comparison, total UK project numbers grew 1.8% from 975 in 2020 to 993 in 2021. Elsewhere in the North of England, the North West picked up 74 projects (down from 85 in 2020, but up from the 73 in 2019) and the North East was home to 30 projects (down from 32 in 2020, but level with 2019).
Yorkshire and the Humber’s decline from 2020 is largely down to a fall in its share of ‘new’ – rather than extended – UK projects. Having secured 39 new projects in 2020 (5.4% of new UK projects), the region had only 26 in 2021 (3.4%).
The latest data mean Yorkshire and the Humber secured 4% of all UK projects, down from 5.6% in 2020 and 5.3% in 2019. The North’s share of projects was 14.5% in 2021, down from 17.6% in 2020, but broadly in line with its 2019 14.6% share.
However, there are some positives for Yorkshire and the Humber, with 5.2% of investors surveyed by EY describing it as the UK’s most attractive place to invest – ahead of both the North West (4.8%) and the North East (3.2%).
The key sectors in the region in 2021 were digital technology (10 projects), agri-food (four), and business services (four) – with digital projects doubling from the five projects last year to reach the second highest annual total in the last five years. Meanwhile, manufacturing projects regained their place as the region’s leading investment activity (11 projects) for the first time since 2017, while business services (10) and Research & Development (nine) rounded out the top three. R&D projects were at their highest level in the last decade.
Suzanne Robinson, EY’s Yorkshire managing partner, says: “Yorkshire had a challenging year for FDI in 2021, as did the wider North of England. Beyond the headline figures, however, there are still reasons for positivity. Yorkshire has done well in some high value areas, particularly digital technology and Research & Development. It’s not just the volume of projects that matters – one high value project can bring more jobs and investment to the region than five smaller ones.
“Across Europe, there is a swing towards investment in manufacturing, a sector in which Yorkshire has historically done well. Combined with the growing importance of ‘cleantech’, the region has an opportunity to establish itself as a key European home for developing and building the green technologies needed for the UK to reach its Net Zero targets.
“One thing which is consistently very clear from investors is that the strength of local business networks matters when they’re choosing where to site their projects within a country. Local skills and infrastructure, support from regional development bodies and access to regional grants are also part of the mix too, reinforcing the importance of devolving power and fostering local ecosystems. Building a unique sense of place from in its economy will help the Yorkshire and the Humber build its attractiveness to investors.”
The leading location for FDI in Yorkshire was Leeds (15 projects), which was the seventh biggest UK location for FDI outside of London.
