Lloyds TSB Yorkshire & Humber PMI® data has shown sharp growth in July.
Business activity expanded at a rate which has been surpassed only three times in the history of this series, which dates back to January 1997.
New orders also recorded substantial growth, and a combination of the two aided an increase in employment.
The headline Lloyds TSB Yorkshire & Humber Business Activity Index – a seasonally adjusted index that measures the combined output of the region’s manufacturing and service sectors – rose from 55.5 in June to 59.8 in July.
This was the fastest rate of growth since December 1999. In addition, July marked the ninth consecutive month of expansion.
New order growth also quickened, resulting in the fastest rate recorded since April 2004 for the region’s private sector.
Of the 38 per cent of businesses who recorded higher levels of new incoming business, a number cited larger sales teams and new projects as key drivers.
Employment rose for the second consecutive month, though at a slightly lower rate than recorded nationwide.
Anecdotal evidence for the rise in payroll numbers indicated higher levels of demand and increased production were the primary factors behind the expansion.
Backlogs rose at the fastest pace recorded since the series began in November 1999.
In addition, July marked the second consecutive month of higher levels of outstanding business. Respondents cited higher demand as the primary factor.
Input costs rose for the eleventh consecutive month in July, though the rate of growth was marginally weaker than input price inflation nationwide.
The recent weakening of the pound was listed by a number of respondents as a cause of higher input costs. Panellists also cited higher oil prices and increased labour costs.
Charges rose for the third consecutive month in the Yorkshire & Humber region. Survey respondents mentioned increased product complexity and the transfer of higher energy costs to customers, as the key drivers.
Commenting on the Lloyds TSB Yorkshire & Humber PMI survey, Martyn Kendrick, area director for Lloyds TSB Commercial Banking in Yorkshire, said:
“Private sector business output rose at the fastest pace seen for over 13 years across Yorkshire & Humber last month.
“New orders also expanded at a rate not seen since before the financial crisis, coupled with the fastest increase in outstanding work ever recorded in the survey.
“Despite this strong expansion, Yorkshire and Humber was only the third fastest growing region after London and the North West, which highlights the recent strength of the UK’s private sector growth.”