BUSINESS confidence in Yorkshire has dipped but remains positive.

Lloyds Bank’s Business Barometer which measures how businesses regard the economic outlook and their own trading prospects shows that confidence in Yorkshire fell by two points in August to 26 per cent, but remains above the year-to-date average reading of 22 per cent.

Companies in Yorkshire reported higher confidence in their own business prospects month-on-month, up two points to 24 per cent, while 16 per cent of businesses expect to increase staff levels over the next year.

Steve Harris, regional director for Yorkshire at Lloyds Bank Commercial Banking, said: “It’s encouraging to see that confidence is broadly steady across the region as businesses continue to settle into their ‘new normal’. Most significant is the uptick in plans to recruit, which suggests that firms are feeling more optimistic about the road ahead and their long-term plans.

“Challenges remain but we will continue to support Yorkshire’s businesses as they continue to invest to drive growth and the recovery.”  

The barometer questions 1,200 businesses monthly and provides early signals about UK economic trends.

In sector terms, there was notable strength in sectors benefitting from the further easing of Covid restrictions.

Services confidence saw the greatest month-on-month increase, rising by eight points to 36 per cent, the highest level since January 2018.

Confidence in both manufacturing and construction also picked up (both up seven points to 40 per cent), led by rises in trading prospects for the year ahead.

The increase in manufacturing confidence came despite ongoing supply disruptions, although the level remains below the high in May.

Retail confidence posted a smaller two-point rise to 34 per cent, remaining below the recent peak in May.

Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said: “Business confidence reaching its highest level in over four years tells a positive story about the country’s economic recovery.

"This confidence is driven by the continued success of the vaccine rollout, the removal of lockdown restrictions and adjustments to self-isolation rules.

“Staff shortages remain a challenge, but as the economy moves back towards pre-pandemic levels we can be optimistic that the momentum for business confidence and economic optimism can be sustained in the months ahead.”