Strong performance continues for Yorkshire’s private and manufacturing sectors and there is welcome optimism on the 12-month outlook amongst local businesses. The rate of growth was the quickest since data collection began in January 1997.
In addition to this, experts predict an even stronger economic recovery in the second half of this year as businesses build confidence to commit to future investments and projects. These positive expectations were associated with forecasts of a robust economic rebound following a resurgence in business and consumer spending as lockdown restrictions continue to be relaxed.
Tim Moore, Economics Director at HIS Markit said: “The latest survey results set the scene for an eye-popping rate of UK GDP growth in the second quarter of 2021, led by the reopening of customer-facing parts of the economy after winter lockdowns. The successful vaccine roll out has generated a strong willingness to spend and fortified business optimism across the service economy.”
Data indicates that the majority of manufacturing sectors are showing strong growth, these include textiles and clothing, food and drink, metals, chemicals and electrical. Disappointingly the transport equipment industry hasn’t quite bounced back like the others.
Service sectors are also in good stead to bounce back to pre-coronavirus levels as computing, financial, business-to-business and professional services record impressive results. The only negative is the hospitality and catering industry which is still heavily affected by the lockdown restrictions and could seriously benefit from additional government financial support.
Although there is much positive economic news, there is also an elephant in the room – Brexit. The big concern even before the result in 2016 was that it could potentially create a labour shortage as a consequence of the rapid decline in the number of EU workers.
Coronavirus and the extension of the furlough scheme are contributing factors to the shortage and as a result of continuous setbacks for workers in the poorly performing sectors, (such as loss of job, reduced wages or reduced hours) we see many people opting for completely new career changes with no intention of returning which puts even more strain on those sectors.
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Statistics taken from NatWest Yorkshire & Humber PMI – May 2021 & IHS Markit / CIPS UK Services PMI – June 2020