Growth returned in a sharp and accelerated fashion across Yorkshire and the Humber economy this past month.
September’s seven month low was swept aside in October with a near five point increase in NatWest’s Yorkshire & Humber Business Activity Index – the strongest uplift since June.
Improved demand conditions and bolstered operating capacities reportedly drove higher levels across the manufacturing and service sectors.
New work came in stronger than had been seen, with a positive trend in employment continuing. Staff numbers increased for a ninth consecutive month, with the rate of jobs growth quickening to a four-month high.
Richard Topliss, chairman of NatWest North Regional Board, said: “Growth in Yorkshire & Humber’s private sector economy re-accelerated during October – a welcome outcome following three successive months of slowing growth.
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“The pick-up in October was marked too, and the fastest for four months. Firms linked higher activity levels to improved market confidence, stronger demand for their goods and services, as well as bolstered operating capacities. Indeed, we observed continued strong jobs growth in October, which bodes well for the near-term economic prospects in the region.
“However, supply-related issues were still at large and put immense upward pressures on prices in October. Rates of both input cost and output price inflation reached unprecedented heights as firms across the region were impacted by global supply shortages and rising energy prices.”
Backlogs of work increased for an eighth successive month, outpacing the rest of the UK.
On costs, the fastest increase since data was first collected to form the seasonally adjusted index back in 1997.
Input prices increased sharply at both goods producers and service providers, although the rate of increase was particularly steep at the former.
Energy costs, alongside raw material and shipping prices, were frequently mentioned as sources of inflationary pressures.
As a result prices charged for goods and services increased at a rate previously unseen in over two decades of data collection during the month. Of the 12 monitored areas of the UK, only Northern Ireland and Wales registered faster rates of inflation.
Once again the level of confidence was the highest in the UK in Yorkshire and Humber.
Expected gains in market share, sustained recovery efforts from the pandemic and increased workloads were cited as reasons for bullish growth forecasts.