City of Culture boosted wider Yorkshire economy in 2017, SME data shows

Hull's status as European City of Culture is thought to have boosted Yorkshire's wider economy, according to new data.

An art installation is projected onto The Deep in Hull, forming part of the Made in Hull series marking the official opening of its tenure as UK City of Culture in 2017. Danny Lawson/PA Wire

The title has led to an increase in tourist numbers that may have boosted the wider economy, CYBG said.

The bank’s quarterly SME Health Check Index for Yorkshire and the Humber fell by four points to 37 in the last quarter of 2017 although it was the only region outside London to witness an upturn in confidence during those three months.

Sign up to our Business newsletter

Sign up to our Business newsletter

Yorkshire did not escape the fall in the growth rate of lending seen across the country, although this was compensated by a decreased share of SMEs operating below capacity.

Infrastructure investment is seen as crucial for unlocking Yorkshire’s growth potential in the coming years, as well as increasing productivity that currently lags behind the rest of the UK.

Nationally, SMEs recorded the worst business health reading since 2014, as rising business costs, a dip in confidence, lower net business creation and a lack of borrowing are taking their toll, according to CYBG in partnership with the Centre for Business and Economics Research (Cebr)

The quarterly index dropped to a score of 42.01, down 48 per cent since 2014 and the fifth consecutive quarterly fall, suggesting a worsening business and macroeconomic environment since the EU Referendum in June 2016 and the ongoing Brexit negotiations.

David Duffy, chief executive of CYBG, said: “Businesses are scaling back their investment and borrowing due to the wider economic uncertainty, contributing to the decline in the Index.”

The research comes as a new study from found that Leeds had one of the lowest levels of SME borrowing in the UK in 2017.

It found that the average SME debt in the city was £30,425, the fifth lowest in the UK. The highest was Exeter with average debt of £357,770.