EY report: Yorkshire and the Humber sees foreign direct investment growth in 2022 as UK projects fall

The region was the UK’s sixth-best performing in 2022, up from seventh in 2021, while its share of UK FDI projects increased to 5.5 per cent from four per cent.

Building on the region’s encouraging FDI growth in 2022, Yorkshire and the Humber was also ranked as England’s joint-second most popular region for planned investment (alongside the East of England), with six per cent of investment decisionmakers surveyed by EY saying that they plan to expand or establish operations in the region. London led the way on 43 per cent.

The region’s strong 2022 performance was driven by growth in key sectors, including machinery and equipment, utility supply, and health and social work. Sales and business services, manufacturing and logistics were the region’s key FDI activities.

With 15 projects, Leeds was the UK’s joint-fifth best city for FDI projects in 2022. Hull meanwhile was ranked thirteenth with eight projects, and Sheffield was joint-fourteenth, with seven projects.

Stephen Church, EY’s north market leader, said: “Amid a strong year for the North on FDI, Yorkshire and the Humber’s results stand out as exceptional.

"After a few years of falling project numbers, it’s very encouraging to see the region deliver a significant increase in projects and a strong performance on investment attractiveness relative to the rest of the UK.

"A positive performance on FDI-supported jobs in 2022 suggests Yorkshire has been able to do well not just on project volume, but on project value too.

“With sustainability and climate change high on investors’ agendas, clean technology is an increasingly important investment focus, providing the UK with the opportunity to play to its regional strengths.

"Expertise in manufacturing and utilities – key sectors here in Yorkshire – will be crucial to any efforts by the UK to establish itself as a place where clean technology is not just deployed, but also developed and built too.

“The excellent results across the North demonstrate how regional and local leaders can help create business-friendly environments that align with an area’s specific strengths, challenges and needs.

"By empowering local areas to make decisions and implement policies that both support and encourage inward investment, the UK can take further advantage of its regional strengths and unique selling points to attract diverse investment opportunities.”

Despite a year-on-year decline in projects, in line with the national trend, digital technology remained Yorkshire and the Humber’s biggest sector for FDI projects, with a total of eight in 2022, down 10 in 2021.

However, this small fall was more than offset by gains in the machinery and equipment (four projects to six), utility supply (none to six) and health and social care (one to six) sectors.

As with the rest of the UK, sales and business services were Yorkshire and the Humber’s most common type of FDI project activity in 2022, with 19 projects. Manufacturing was the region’s second most common activity (12 projects), followed by logistics (8 projects).