Business confidence in Yorkshire fell 10 points during January to 12%, 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 16 points at 20%. When taken alongside their optimism in the economy, down four points to 3% this gives a headline confidence reading of 12%.
Yorkshire businesses identified their top target areas for growth in the next six months as investing in their team (38%), introducing new technology (26%) and evolving their product and service offer (23%).The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide.A net balance of 26% of businesses in the region expect to increase staff levels over the next year, up six points on last month.
Overall UK business confidence climbed in January, with firms reporting their highest confidence levels since July last year.
Business confidence increased by five points to 22% and the net balance of businesses feeling optimistic about the economy doubled on December’s reading to 16%.
Ahead of National Apprenticeship Week (6-12 February) 30% of businesses across the UK reported that they are looking at opportunities to grow by investing in staff development and training. A net balance of 17% of firms reported plans to create new jobs in the next twelve months.
Steve Harris, regional director for Yorkshire at Lloyds Bank Commercial Banking, said: “At the start of a new year it’s pleasing to see that despite challenges, confidence among Yorkshire businesses remains positive and many are feeling cautiously optimistic about their prospects for the coming year.
“While challenges around supply chains and rising prices are tricky waters to navigate, having help from advisors and peers, as well as having a clear view on cash flow, will help to put businesses in the strongest position to move forward.”
For the second month in a row, confidence in the manufacturing and service sectors increased, with manufacturing rising to 28% (up 15 points) and services up to 25% (up seven points). Business confidence in construction was down two points to 27%, while retail confidence fell for the second month in a row to 7% (from 13%), the lowest level since February 2021.
Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said: “Business confidence continues to improve following the December boost. Firms are clearly more optimistic about the wider economy and this is driving the increase, helped by precursory signs that wage and other cost pressures may be easing.
“It is still a tough environment for businesses, with high energy bills remaining a concern during the winter months, but there are grounds for optimism for 2023 if inflation starts to trend lower.”
