The Yorkshire and Humber economy has returned to contraction in a survey that pegs the region as the worst performer in the UK.
The NatWest Regional Growth Tracker suggested the regional economy had arrested three months of decline in May, but it has returned to negative figures for June due to a renewed downturn in private sector activity. The survey – which measures month-on-month change in the region’s manufacturing and service sectors – stood at 47.7 in June, below the crucial 50.0 mark that separates growth from decline.
Demand for goods and services from firms in Yorkshire and Humber fell again, in line with a trend seen in the 12 months to April this year, while companies surveyed reported low client confidence and a hesitancy from customers to place orders. The decline in Yorkshire and Humber sales activity contrasted with a modest expansion across the UK as a whole.
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Malcolm Buchanan, chair of the NatWest North regional board, said: “Our Regional Growth Tracker once again highlighted weakness in Yorkshire and Humber’s private sector economy, with business activity and new orders shrinking in June after some improvement in May.
“Whether this could be a temporary blip due to the upcoming general election, which did cause growth momentum to slow across the UK more broadly in June, remains to be seen. However, the region has underperformed consistently for a while now, and business confidence slid to a 20-month low during the latest survey period.
“Nevertheless, there are positive takeaways. Employment growth strengthened to a seven-month high, with panel members citing recruitment drives and company expansion. From this, we can certainly deduce a feel-good factor in some parts of the local economy, which could help spur growth in the second half of 2024.”
The survey found that costs at Yorkshire and Humber firms continued to rise at a sharp pace during June, while the prices they charged also rose.
The new Labour Government has made economic growth one of its key missions, and Chancellor Rachel Reeves has used her first major speech to say the Government would make major changes to speed up infrastructure projects and unlock private investment.
She said: “The question is not whether we want growth, but how strong is our resolve? How prepared are we to make the hard choices and face down the vested interests? “How willing, even, to risk short-term political pain to fix Britain’s foundations?”
The Labour manifesto committed to wholesale planning reforms to make it easier to build and a greater focus on driving through key infrastructure projects and boost housebuilding. The manifesto also promised to update planning policy to make it easier to build laboratories, digital infrastructure and gigafactories as well as 1.5 million homes.
Original artice – https://business-live.co.uk/all-about/yorkshire-humber
