Positive signs show that recovery is still gaining ground in region

The latest survey of purchasing managers showed the sharp output growth seen over the summer months continued into August, though eased slightly from July’s recent peak.

Input prices recorded a twelfth successive increase and rose at the fastest pace for two years.

The seasonally adjusted index – which measures the combined output of the region’s manufacturing and service sectors – fell from 59.8 in July to 57.3 in August.

The index remained well above the 50.0 no-change mark separating growth from contraction, and indicated the tenth successive increase in business activity in the region.

New orders continued to expand sharply in August, though the pace of growth eased marginally from July’s nine-year high.

Panellists largely attributed the rise to an increase in clients
and larger export orders. A number also cited an expansion in domestic demand as a key driver.

Employment grew for the third successive month in August, though the increase was only fractional.

Staffing levels across the UK as a whole rose at a marginally faster pace than in Yorkshire.

Martyn Kendrick, a regional director at Lloyds Bank, said: “The rate of growth slowed from July’s record high and was lower than that recorded for the UK overall, which rose at a pace not seen in 16 years. However, business activity in Yorkshire remained strong and the region continued its 10-month sequence of growth.

“If production and new orders continue to expand at the current pace, it cannot be long before employment follows suit.”

Meanwhile, accountancy firm BDO said business prospects have reached a 29-month high and point to robust growth.