Growth momentum eased in December, says survey

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BUSINESS activity remained strong in Yorkshire last month, as the economic recovery continues, according to data published today.

December’s Lloyds Bank Commercial Banking Yorkshire & Humber PMI survey signalled a 14th successive month of rising private sector business activity. Although the pace of expansion remained strong, growth momentum eased to a six-month low, according to the survey. The headline Lloyds Bank Commercial Banking Yorkshire & Humber Business Activity Index – a seasonally adjusted index that measures the combined output of the region’s manufacturing and service sectors – fell from 56.9 in November to 55.8 in December, the third consecutive decrease in the index and the lowest reading since June 2013. However, this still signalled further expansion of business activity at Yorkshire and Humber private sector firms. New order growth eased further from October’s record high, as the seasonally adjusted Index fell to a six-month low. December marked the 17th consecutive month of new business expansion. Employment in the Yorkshire and Humber region rose for the seventh successive month in December. Some respondents said the latest recruitment drive was due to business activity growth and the need to improve production capacity. Backlogs of work fell for the second consecutive month in December, although the pace of decline eased from November. Across the UK as a whole, the level of outstanding business grew for a seventh consecutive month.

Martyn Kendrick, area director for SME Banking in Lloyds Bank Commercial Banking, said: “Yorkshire and Humber companies continued to expand during December, with business activity and new orders rising strongly. However, both output and new order growth had weakened to six-month lows in December. “Given the uncharacteristically steep expansion recorded in the autumn of 2013, it is perhaps unsurprising that growth is now returning to trend, though the latest results still represent strong growth in the region.”

According to Capital Economics, the South East, East Midlands and London appeared to have been driving UK economic growth in late 2013.

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