Business confidence in Yorkshire and the Humber rose 11 points during May to 45%, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies in Yorkshire and the Humber reported higher confidence in their own business prospects month-on-month, up 16 points at 50%. When taken alongside their optimism in the economy, up five points to 39%, this gives a headline confidence reading of 45% (vs. 34% in April).
A net balance of 29% of businesses in the region also expect to increase staff levels over the next year, up eight points on last month.
Looking ahead to the next six months, Yorkshire and the Humber businesses identified their top target areas for growth as entering new markets (41%) and evolving their offering (31%). A quarter (25%) said they planned to introduce new technology or to invest in sustainability.
The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide. The data for this edition was collected between 1–16th May, before the UK general election was announced.
National picture
In May, overall UK business confidence reached its highest level since 2015 – rising by eight points to a net balance of 50%.
Businesses showed increased optimism in both their trading prospects (up nine points month-on-month to 54%) and the economy (up seven points to 46%). Firms’ trading outlook was the most optimistic in seven years, while economic optimism was the highest recorded since September 2021.
Scotland and the South East of England were the most optimistic of the UK nations or regions in May (both 57%), followed by the West Midlands (56%).
Sector insights
Similarly, there were particularly strong results reported in the construction and services sectors this month. Prospects in the construction sector jumped to 58% (up 20 points), the highest for 14 months, while in services, expected output increased to 57% (up 12 points). On the latter, it is the highest level since the survey was expanded in 2018. Expected business activity in the retail sector also improved to 49% (up three points).
Although trading prospects in manufacturing eased slightly to 49% (down three points), the underlying trend over the last three months remains positive.
Martyn Kendrick, regional director for Yorkshire and the Humber at Lloyds Bank Commercial Banking, said: “It’s no surprise that Yorkshire’s firms are so confident in their own prospects – this is a region with huge adaptability, resilience and a deep pool of skill and insight.
“As businesses look at how they can drive further growth on the back of such a positive outlook, we’ll be by their side with our backing and insight to help them ensure they’re equipped for whatever lies ahead.”
Hann-Ju Ho, senior economist, Lloyds Bank Commercial Banking, said: “These results highlight a notable improvement in business confidence. Optimism about the economy increased to 46% this month – the highest result since September 2021, when the country was emerging from the Covid-19 pandemic, but before the energy crisis after the invasion of Ukraine.
“The regional picture has also improved – we’ve now seen increases in seven of the UK’s 12 regions, where there was previously a more mixed picture. Results in the South East, Scotland and the West Midlands were particularly strong. Across the sectors, there were strong, broad-based improvements in services and construction.”
