Yorkshire and Humber business confidence improves at end of 2024 - NatWest Growth Tracker

The pick-up in optimism also coincided with stronger selling price increases, despite cost pressures abating. Meanwhile, demand conditions showed some stability, with the level of new incoming orders broadly unchanged since November.

The headline Yorkshire & Humber PMI Business Activity Index – a seasonally adjusted index that measures the month-on-month change in the combined output of the region’s manufacturing and service sectors – increased in December to 49.2.

While this signalled a drop in the level of private sector output compared to the previous month, the decline was only marginal overall and slower than that implied by the November figure (48.0).

Malcolm Buchanan, chair of the NatWest North Regional Board, said: "The UK economy appeared to lose a bit of steam as 2024 came to an end – a reflection of what's happening more broadly at the regional level – but there were still plenty of positives to take from the Yorkshire & Humber survey.

“For starters, business confidence improved strongly, with the region recording growth expectations for 2025 which were among the strongest seen across the UK.

“A softening of cost pressures in tandem with faster output price increases is also good news from a corporate earnings perspective. However, it appears the local labour market's resilience has been broken, with employment falling for the first time in three months. Although, by comparison to those at the UK level, job losses were only modest."

Private sector companies in Yorkshire and the Humber registered a robust level of business confidence in December, with year-ahead growth expectations improved markedly.

The region's private sector firms were among the strongest of the 12 monitored UK nations and regions. Only the East Midlands and London saw greater levels of optimism than that seen locally.

According to surveyed companies, hopes of improved demand conditions, a pick-up in the construction sector and investment plans underpinned positive forecasts.

As for December sales performances, the latest survey data revealed a broadly flat end to the year for local businesses as new orders dipped fractionally on the month. For the UK as a whole, private sector new business receipts shrank in December, and to a quicker extent than that seen in Yorkshire and the Humber.