Business activity among firms in the Yorkshire & Humber region continued to grow steeply in August. The pace of expansion accelerated to the fastest since June 2015, according to the latest Lloyds Bank Regional Purchasing Managers’ Index® (PMI®) survey.
The latest upturn in new orders was the strongest for three months and above the UK average, with local firms linking the rise to higher demand from new and existing clients.
The Yorkshire & Humber Business Activity PMI registered 58.1 in August, up fractionally from July’s reading of 58.0. This indicated a sharp increase in output of goods and services by firms in the region. Any reading above 50 signifies growth in business activity.
The Lloyds Bank Regional PMI, or Purchasing Managers’ Index, is the leading economic health-check of the UK regions. It is based on responses from manufacturers and services businesses about the amount of goods and services produced during August compared with a month earlier.
On the price front, companies’ costs rose markedly in August. The rate of input price inflation – which includes raw materials, salaries, rents, utilities, taxes and more – was the fastest of the 12 UK regions. Growth in the prices charged for goods and services accelerated to a four-month high, with some firms noting that higher input costs were passed on to clients.
Business confidence remained robust in August, despite dipping to the weakest in a year. Although local firms commented on strong client demand and planned investment, some highlighted political uncertainty as a reason for relatively subdued sentiment.
Leigh Taylor, regional director for Yorkshire at Lloyds Bank Commercial Banking, said: “Business activity in the Yorkshire & Humber region jumped in August, at its fastest rate since June 2015.
“New orders also increased steeply, reflecting strong demand from new and existing clients, while backlogs rose at the joint-quickest pace in the entire series history, driving employment growth.
“However, business confidence slipped to its lowest level in 12 months, which local firms linked to political uncertainty.”