Confidence to pick up in the region over the coming year

The report found that new orders have risen for the first time in four months and employment is falling at a slower pace.

The index, which measures the month-on-month change in the combined output of the region’s manufacturing and service sectors, registered 49 in June, up from 29 in May. The reading pointed to the slowest contraction in private sector activity in Yorkshire since the introduction of coronavirus lockdown restrictions in March.

Following three months of successive decline, Yorkshire firms’ output increased in June. The rebound was one of only three recorded across the 12 monitored UK regions (alongside the East and West Midlands). Anecdotal evidence suggested that improved demand conditions were driven by the easing of coronavirus lockdown restrictions.

Despite a rebound in new orders, private sector firms in Yorkshire continued to cut their staff numbers in June. Some panellists suggested that reductions were because demand remained well below pre-coronavirus levels.

Richard Topliss, chair of the NatWest North Regional Board, said: “The Yorkshire & Humber private sector continued to trend towards stabilisation in June, with activity falling only marginally after three months of sharp contraction.

“However, the most positive reading came from the New Business Index, which pointed to the return of demand growth following a three-month absence.

“Though only marginal, the improvement in demand conditions should give local businesses the confidence to start ramping up operations now that restrictions are being eased, and the region should see a rise in activity in the coming months. Firms were seemingly confident of an activity expansion in the year, which suggests it is only a matter of time before Yorkshire and Humber businesses produce sustained growth once again.”