Why there is optimism among Yorkshire businesses about growth despite mounting economic challenges: Ben Kimball

The phrase we keep on hearing from Government is growth. In the wake of the Chancellor’s Spring Statement, there’s been renewed interest in what that really means for business.

As far as businesses are concerned, this Spring Statement was light on developments.

While cost increases brought in in the Autumn Budget remain at the forefront of businesses day-to-day struggles, there was little indication that they will receive relief any time soon. The economic picture the Chancellor painted is bleak.

However, the good news is that despite the challenges, companies across Yorkshire remain optimistic about growth. From conversations we have had with corporate finance advisers, there is more positivity in the market.

In the immediate aftermath of the Chancellor’s Mansion House speech in November, we did see a pause in activity. Businesses and lenders were understandably reassessing valuations and the additional costs of new taxes, and what it all meant to the bottom line.

Activity is starting to pick back up again.

In fact, 40 per cent of corporate financial advisers that we speak to are predicting that deal volumes will increase in the first half of 2025, with a further 44 per cent believing market conditions will hold steady.

It’s quite a change from the conversations we were having at the end of last year.

I do continue to have concerns because the picture is not wholly positive.

For certain businesses, especially in sectors like retail and hospitality, the additional employment costs they are facing will be extremely difficult.

Any additional price increases, such as potential trade tariffs between the UK and major partners, will only intensify these challenges, making it harder for small businesses to remain competitive.

Not everything here can be passed onto customers, and you begin to enter the world of reducing opening hours, cutting back on staff or even considering restructuring options.

I also worry that many companies, especially mid-sized businesses, will adopt a ‘suck it and see’ approach when it comes to funding. Pausing on investment may slow down productivity and organic growth.

While the Government committed itself to investing in skills development, there will inevitably be a delay between any investment and its impact on productivity.

If the Chancellor is serious about growth, then it’s vital that policy gets behind entrepreneurs.

Businesses adapt to huge challenges at home and abroad, so we need to create the right conditions to help them in the right direction.

Ben Kimball, Senior Director for Business Development for ThinCats