Yorkshire sees first decline in employment for over two-and-a-half years
The private sector economy in Yorkshire and the Humber continued to slow down in February, according to the latest NatWest PMI survey data.
Companies in the region reported slower increases in output and new orders, with both expanding at the weakest pace in over two-and-a-half years.
February also saw the first decline in employment since August 2016. In addition, business confidence weakened to the lowest on record.
The NatWest Yorkshire and the Humber Business Activity Index, a seasonally adjusted index that measures month-on-month changes in the combined output of the region’s manufacturing and service sectors, fell to 52.0 in February from 52.8 in January.
This reading was the lowest recorded in the current sequence of growth dating back to August 2016.
By sector, manufacturers recorded a stronger rise in output than their service sector counterparts.
In line with the trend for activity, new business placed at Yorkshire and the Humber companies rose at a softer pace in February. However, growth of new orders in the region contrasted with a fall across the UK as a whole.
Respondents also noted that increased demand across both domestic and overseas markets supported the latest upturn in sales.
On the labour market front, February’s survey data showed the first decline in regional employment since August 2016.
The amount of outstanding business (orders received but not yet completed) at Yorkshire and the Humber firms declined for the fifth successive month in February.
As for the year ahead, the outlook among regional firms remained positive in February. This was despite the level of optimism having dropped to the lowest since the start of the series in mid-2012.
Richard Topliss, chair of NatWest North Regional Board, said: “Yorkshire and the Humber’s private sector economy continued to slowdown in February. Weaker growth of output and new orders was seen alongside the first fall in employment since August 2016. Nonetheless, the region continued to outperform the UK as a whole.
“Cost pressures eased as input price inflation recorded by panellists slowed to a 30-month low, offering some respite to local firms.
“Worryingly, February’s data for business sentiment showed regional firms at their least optimistic since the start of the series in mid-2012. That said, local businesses remain positive towards the year-ahead outlook amid expectations of greater customer demand and planned investments in new technologies later in 2019.”
