Business confidence in Yorkshire and Humber lowest level for five years

Business confidence in the Yorkshire and Humber continues to weaken and is now the lowest it has been in five years. According to the latest ICAEW Business Confidence Monitor (BCM), a confidence score of -2.0 was recorded this quarter. Looking forward to 2017, businesses in the region are anticipating a slightly tougher year ahead.
Q4 2016 Key Findings:

· The ICAEW Business Confidence Index has turned negative in the Yorkshire and Humber for the first time since Q2 2011, with a score of -2.0

· Domestic sales are growing 3.8% year on year, similar to the 4.1% recorded a year ago

· Export sales growth has more than doubled to 2.8% from 1.2% 12 months ago

· Growth in sales volumes is expected to slow in the next 12 months to 3.2% and input prices are also expected to rise by 1.7% in the year ahead, compared to 1.4% of the year to date

· Job creation is predicted to weaken to just 0.7% year on year in 2017, compared with 1.2% in Q4 2016
Chris Manners, ICAEW Yorkshire and Humber Regional Director said:
“It is a concern that business confidence in the Yorkshire and Humber is now at the lowest level for five years. Despite a pre-existing downward trend, external shocks experienced in the year to date, notably the Brexit vote, and uncertainty around the Northern Powerhouse and regional devolution are likely factors.

“On a more positive note, export sales growth is on an upward trend, as businesses in the region are able to take advantage of new export opportunities and make the most of the fall in sterling. However, this is likely to be countered by imports becoming more expensive for UK business. Looking forward to 2017, businesses are expecting a slightly tougher year. Input prices are forecast to rise, whereas businesses do not expect any acceleration in their selling prices. This combination will likely erode profit growth for the next year.”

For more information: www.icaew.com/bcm