Leeds economic growth set to ‘outpace’ UK average over next three years

Yorkshire and the Humber is forecast to see average annual GVA growth of 1.5 per cent over the same period, marginally slower than the predicted overall UK rate. The region’s average annual employment growth of 0.6 per cent is also expected to be slightly slower than the national rate of 0.7 per cent over this period.

However, employment growth in Leeds is expected to outpace the national rate between 2025 and 2028, with average annual growth of 0.8 per cent.

By 2028, Leeds' local economy is expected to be more than £2.5bn larger than in 2024 when measured by GVA.

Tim West, Leeds office managing partner at EY, said: “Leeds’ economy is expected to outpace the overall UK growth rate over the next three years, which is a clear reflection of the city’s dynamic and resilient business community.

"Leeds’ concentration of knowledge-based sectors is expected to be a major asset in the coming years, with the city’s local tech and professional services sectors forecast to contribute significant economic growth and job opportunities.”

The North Yorkshire region is expected to see faster average annual GVA and employment growth than the UK national rates, with 1.7 per cent and 0.8 per cent respectively.

The manufacturing, wholesale and retail trade, and real estate sectors are expected to be Yorkshire and the Humber’s biggest contributors towards GVA between 2025 and 2028.

Manufacturing remains a pivotal part of the region’s economy, and is expected to contribute 13 per cent of all Yorkshire and the Humber GVA by 2028. However, the region’s manufacturing employment is expected to contract by an average annual rate of 1.7 per cent over the next three years as the sector contends with elevated energy and labour costs, which is set to narrow margins.

Information and communication (which involves technology-led activity) is expected to be Yorkshire and the Humber’s fastest-growing sector from 2025 to 2028 with average annual GVA growth of 2.7 per cent.

Sheffield, Wakefield and West Yorkshire Combined Authority are expected to have the joint-second fastest-growing economies across the region from 2025 to 2028, with each projected to see annual average GVA growth of 1.5 per cent over the period – equal to the average across Yorkshire and the Humber.

Sheffield is expected to see its employment growth rate match the national average (0.7 per cent), while West Yorkshire Combined Authority (0.6 per cent) and Wakefield (0.5 per cent) are forecast to see slightly slower upticks.

Elsewhere in the region, Barnsley and Doncaster are expected to see annual average GVA growth of 1.4 per cent, trailing slightly behind the national and regional averages.