BUSINESS figures across York and North Yorkshire are calling for a rise in interest rates.

The Yorkshire Shadow Monetary Policy Committee (MPC) has voted six to one for a small increase, after unanimously voting to hold interest rates in December 2021.

The MPC is a partnership between Clive Owen LLP and The Press, which considers the state of the region’s economy and gives experts from a variety of sectors the opportunity to argue their case for a shift, or hold, in the rate.

Rob Whitehead, of Clive Owen, said: "It continues to be a mixed bag. There's a lot of businesses that have been very profitable over a number of years that, obviously, took a dip in the pandemic and then saw an increase in business coming out of that and were talking quite positively about the year ahead."

He said the country had 'lurched from' Brexit to the pandemic and now the Ukraine situation and there was ' a lot of uncertainty'.

However, there were businesses, which had accrued cash reserves that had 'a lot of investment planned'.

Gary Smith, of Tilney, highlighted clients' concerns about rising costs, citing a food manufacturer, which imports from Europe, that had seen the price of meat go up 33 percent last week.

He questioned the ability of interest rates to sort out inflationary pressures caused by the rising price of oil due to the Ukraine conflict, but said a rise was needed to tackle other inflationary issues.

"Russia invading Ukraine has, obviously, created more turmoil in the markets with the worry about rising oil prices and how that will effect inflation going forward. On the flip side we still see an appetite for people who have cash to be funding their pensions and their ISAs."

Jessica Russell, of Castle Recruitment, said cash flows in some industries, including engineering and manufacturing, were being impacted by an increase in the cost of raw materials, which 'will absolutely put a dampener' on recruitment.

She said they were advising employers to consider additional benefits that might supplement salaries to attract candidates.

"Confidence is still there, but it is very much a candidates-led market at the moment."

Richard Peak, of Helmsley Group, said the property market was 'very buoyant', but he was worried about whether that would continue and flagged fears that a recession could be on the horizon.

"The recent events in the Ukraine are going to spook a lot of people. In terms of what's going on, when you couple that with the inevitable price rises across the board - it is going to be a more difficult time for people."

Dave Broadbent, of Begbies Traynor, said one in three of the business insolvencies it was handling were being driven by Covid bounce back loans, which came into being in April/May 2020 and were now starting to bite with many businesses unable to pay them back.

"The other reason for businesses struggling at the moment is just lack of work." he added.

Steve Lowe, of Newsquest in York, said: "All the restrictions coming off have meant businesses have felt optimistic for the first time for two years. Most are on a customer re-engagement plan to try to get customers back into the high street and into the shops."

People had spent savings on home improvement projects during the pandemic and now that money was being switched to 'getting out and about again' on leisure activities such as weekends away, shopping, theatre and cinema trips. He also flagged up the 'big issue' of rising prices in the supply chain saying that his company's raw print materials had increased by 30 percent and its customers were experiencing soaring running costs as well.

Gill Gitsham, of manufacturer GSM, said: "Our order book is a strong as it's ever been. There's huge demand at this moment in time, but that gives us on-going pressures from recruitment - we just cannot get people in."

She added that people's expectations of salary levels were so much higher than in the past. She also pointed out that Russia was the second largest exporter of stainless steel, which had affected the price of raw materials.