A strong rise has been seen in both the performance and confidence of Yorkshire businesses, new data shows.
The latest Quarterly Economic Survey showed both service sector firms and manufacturers reporting an increase in overseas sales.
Both sectors expect to increase their profits in the coming three months and to take on more staff.
And, after months of stagnation, appetite for investment appears to be creeping back – both into staff training and in capital projects.
However, progress is still being impeded by cost pressures, with inflation and interest rates placing a significant drag on performance.
In addition to this, the Chamber asked Yorkshire firms about the impact of artificial intelligence on their operations. We found that just one in four companies were concerned about the potential impact of AI on their business while just under a third had taken steps to mitigate against it.
Martin Hathaway, managing director of Mid Yorkshire Chamber of Commerce, said:
“It is extremely encouraging to see export sales, employment and investment all on the rise this quarter.
“With a turbulent economy and various challenges stemming from the war in Ukraine, ongoing Brexit and Covid-19 fallout and uncertainty around HS2 and net zero initiatives, Yorkshire businesses have shown true resilience and skill over the last few months, pioneering our region as the place to do business in the UK.”
Among service sector firms there was a 15 per cent increase in those firms expecting to swell profits in the coming three months. Meanwhile the number of manufacturers expecting the same result grew by two per cent.
A big growth area was that of overseas sales. Manufacturers who export posted a 15 per cent increase in activity while service sector firms saw sales abroad increase by 11 per cent.
While the labour market remains tight, both sectors are looking to increase their headcount in the run up to Christmas with service sector businesses seven per cent more likely to take on staff and five per cent more manufacturers looking to do the same.
After months of decline, manufacturers looking to invest in plant and machinery rose by 22 per cent, while those seeking to invest in training rose by 15 per cent.
However, the fieldwork did show that pressures remained. The cost of labour and energy continue to pose headaches while interest rates and inflation remain the principal cost pressures facing business.
Finally, artificial intelligence is causing concern for just 25 per cent of businesses, with 75 per cent said it was of no consequence to them. Just 31 per cent of firms had taken steps to mitigate against any potential impact it may bring.
Mark Casci, head of policy and representation at West & North Yorkshire Chamber, said:
“While there have been signs of cautious optimism in Yorkshire’s business community for several month, this is the first time there has been broad consistency of both strong performance and outlook in quite some time.
“Investment, on pause for most firms for more than a year, looks to be returning. Overseas sales are up, as are expectations for profits.
“One swallow does not a summer make, and it will only be when we experience a sustained period of consecutive quarters of growth that we can begin to say the worst is behind us.”
Tracy Brabin, mayor of West Yorkshire, said: “The results of the latest quarterly economic survey are grounds for cautious optimism.
“Businesses across our region are reporting an improved outlook for their order books, greater investment in their staff and equipment, and are more confident about their future profitability.
“Having access to good, skilled people is crucial if businesses are to grow and succeed, as we build a brighter West Yorkshire that works for all.
“So, it is great to see that many businesses also plan to hire more new staff over the next three months, in what is already a tight and competitive labour market and are putting greater emphasis on training and skills.”