Yorkshire business confidence rated highest since 2008

The twice-yearly report, which canvassed the views of 103 Yorkshire firms in terms of likely sales, orders and profits for the coming six months, presents the overall “balance” of opinion, weighing up the percentage of firms that are positive in outlook against those that are negative.

The overall confidence balance is the average of the individual balances, for sales, which was 28 per cent, orders, which was 26 per cent, and profits, which was nine per cent, and it has risen to 21 per cent in the region, from a balance of 16 per cent in July. This compares to the national confidence balance of eight per cent and makes Yorkshire the most confident region.

However, over two thirds of firms said that they are more worried about weak markets at home than any other potential threat to their business – a rise from 52 per cent in the last survey.

Over a third of businesses in the region expect to grow their total exports during the first half of the year, but nine per cent are braced for a fall, resulting in a balance of 27 per cent expecting exports to rise. This figure has grown seven per cent from the balance recorded in the last survey.

Twenty seven per cent of businesses expect exports to Europe to improve in the first half of the year, while 15 per cent anticipate weaker demand. The resulting balance of 12 per cent is weaker than the balance of 15 per cent recorded in the last survey. In contrast, the balance for exports to the rest of the world was marginally higher at 18 per cent, rising from 17 per cent in July.

Nearly a fifth say they plan to boost investment spending over the next six months, with the same amount planning to reduce it. The resulting balance of zero is one per cent lower than in the last survey.

Some 16 per cent of Yorkshire businesses said they intended to increase staff numbers during the first half of 2012, while 13 per cent are planning reductions. The result is a positive balance of three per cent, compared to July’s balance of five per cent.

John Robson, regional director for Lloyds TSB Commercial in the Midlands and North, said: “Export markets outside Europe will be the key to growth for businesses, in what will undeniably be a tough start to the year.

“It is understandable that businesses are keeping the brakes on investment, given the volatile economic climate, but it is crucial that firms in Yorkshire do whatever they can to maximise opportunities, at home or overseas.”