Business optimism falls in Yorkshire
Business confidence in Yorkshire fell 11 points during August to minus 5%, according to the latest Business Barometer from Lloyds Bank Commercial Banking.
Companies in Yorkshire reported lower confidence in their business prospects at minus 4%. When combined with their view on the economy, this gives an overall confidence of minus 5%.
Businesses’ hiring intentions showed that a net balance of 19% of businesses in the region expect to reduce staff numbers during the next year. This is 21 points down compared with July’s results, when a net balance of two per cent expected to increase their headcount.
Across the UK, overall confidence slipped to one per cent, as businesses became less optimistic towards the economic outlook, while confidence in their own prospects fell to eight per cent.
The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.
Kelly Green, regional director for Yorkshire & the Humber at Lloyds Bank Commercial Banking, said: “It’s clear that the current uncertainty is having a negative impact on the optimism of Yorkshire businesses, as we are seeing across the rest of the UK.
“However, as we know from many years of experience, the region’s business community is highly resilient and ready to innovate, and we look forward to confidence returning in the months ahead.
“Whatever happens, we will be by the side of businesses across the region, supporting them in achieving their growth plans. To that end, we have pledged to lend up to £1.4 billion to Yorkshire businesses throughout 2019.”
Across the region, a net balance of 27% of businesses said they felt that the UK’s exit from the European Union was having a negative impact on their expectations for business activity, up 15 points on a month ago.
Businesses in the West Midlands showed the most confidence, at 15%, ahead of the South West (11%) and London (7%).
Those in Scotland were the least confident, with an overall confidence of minus 9%, 10 points below the national average.
In August, business confidence in the construction sector rose by six points to 12%. Meanwhile, overall confidence fell by 16 points to three per cent in the manufacturing sector, and by 11 points to 6% in retail, the lowest levels seen for those sectors this year.
Confidence was also down 15 points to minus 3% in the services sector, bringing it near to the February low of minus 4%.
Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said: “We have seen a dip in overall business confidence this month, with firms appearing less positive about their own trading prospects and the broader economy, and remaining low against the historic average.
“While ongoing economic uncertainty is likely a key driver, it’s worth noting that companies’ assessment of the expected impact on their business of the UK leaving the EU has remained broadly unchanged this year.”
