Despite companies across the UK continuing to struggle amidst rising interest rates and stubborn inflation, business confidence in Yorkshire and the Humber appears to be resilient with levels of start-ups in the region in July higher than those in much of the UK.
The latest research from the UK’s insolvency and restructuring trade body, R3, which is based on an analysis of data provided by CreditSafe, shows that the number of new businesses in Yorkshire and the Humber rose by 6.5% between June and July 2023. After a year of challenges and economic uncertainty, levels remained consistent year-on-year with an increase from 4,383 start-ups in the region in July 2022 to 4,452 in July 2023 (a rise of 1.6%).
In fact, of the 12 regions and nations surveyed, only Northern Ireland saw a stronger rise in new businesses with a 21.4% uplift month-on-month; and only Wales experienced a fall in start-ups (down by 1.4%) since June 2023.
Another indicator of economic health, levels of insolvency-related activity (which includes liquidator and administrator appointments and creditors’ meetings), also showed a positive picture with Yorkshire and the Humber among the six regions and nations seeing falls since the previous month. The most marked decrease was experienced in the North East (-18.8%), followed by Scotland (-14.3%), Wales (-12.8%) and then Yorkshire and the Humber (-8%). In contrast, the highest increases last month were recorded in Northern Ireland (+14.3%), the South East (+12.6%) and the South West (+9.9%).
Eleanor Temple, chair of R3 in Yorkshire and a barrister at Kings Chambers in Leeds, said: “The economic climate remains very difficult with both businesses and individuals being forced to tighten their belts in the face of higher interest rates and inflation.
“However, it is encouraging to see that entrepreneurship appears to be alive and well with the percentage of new businesses launching in July increasing month-on-month in almost all regions and nations. It is also good to see Yorkshire’s legendary grit with the region among the strongest performing both in terms of start-ups and insolvency related activity.
“However, after five years of lost growth, there are still real fears that the UK economy may slide into recession next year with output remaining lower than its pre-Covid peak. As we head into the winter, it is vital that directors continue to adopt a cautious approach, keeping a close eye on their finances and seeking professional advice as soon as any problems become apparent.”
