Business confidence drops as Covid winter bites

Andy Wood

The confidence and resilience of Yorkshire businesses that held up well during the roller-coaster journey through 2021 is facing another dip over the impact of Covid this winter.

Grant Thornton UK LLP’s Business Outlook Tracker surveyed c.600 mid-market businesses every other month during a year that began in full lockdown and was followed by a gradual exit from restrictions up to ‘Freedom Day’ in July.

Optimism in Yorkshire and the Humber about the country’s economic prospects averaged 75% over the year, above the national average of 72%.

However in the final survey conducted in late November and early December there was a significant dent in confidence, with some 10% of businesses in the region describing themselves as “pessimistic” about the future of the economy.

The views were gathered prior to the announcement of the Government’s Plan B measures but follow on from panic buying in September which led to the most marked setback in regional confidence.

Despite the drop the region has still ended the year with 68% of businesses asked confident of revenue growth, although this is down from the summer peak of 90%.

Andy Wood, managing partner of Grant Thornton UK LLP in the Yorkshire and Humber region said: “It’s no exaggeration to describe 2021 as a year like no other – with some significant local highlights such as the launch of the Leeds-based UK Infrastructure Bank in July, Channel 4’s launch in Leeds and some outstanding local deals coming to market as confidence and pent-up demand returned.

“However, our businesses have had to cope with a myriad of economic headwinds – many, such as energy price costs and labour challenges, have been outside of their control – and in general I think we can be proud of the old-fashioned Yorkshire-grit we’ve displayed.

“The new variant of Covid is clearly a concern and is casting a shadow over the festive period, particularly in retail and hospitality, but we are infinitely better prepared for any future challenges in terms of business resilience and, of course, unlike the first lockdown, we now have vaccines to help protect us from the virus.”