New data reveals a significant upturn for the North East economy, with business confidence soaring to its highest level in more than four years.
Strong Growth Outpacing the National Average
According to the influential NatWest North East Growth Tracker, the region's private sector activity has returned to growth. The tracker's score, which measures changes in manufacturing and services, jumped from 49.3 in September to 52.3 in October. Any figure above 50 indicates economic expansion.
This growth was not only positive but also robust, with the North East's expansion rate surpassing the UK average. In fact, only London and the South East saw greater increases in business activity during this period.
Rising Employment and Easing Inflation
The positive trend extended to the jobs market, marking a crucial turning point for the region. The survey reported a renewed increase in employment levels in October, effectively ending a ten-month sequence of job shedding.
This rise in headcounts within the North East presented a stark contrast to the falling staffing numbers reported at a national level. NatWest linked this employment growth to a further easing in inflationary pressures, which also contributed to the slowest rise in output charges in nearly five years.
Sustained Optimism for the Future
This October increase marks the third time growth has been recorded in the past five months and is the strongest since November 2024. This has fuelled hopes that the regional economy is decisively turning a corner.
Malcolm Buchanan, chair of the NatWest North regional board, stated that the region entered the final quarter of 2025 on stronger footing. He highlighted that new business rose at the strongest rate since November 2024, directly driving the increase in overall activity.
This positivity has filtered through to business sentiment. Companies in the North East expressed their strongest confidence since May 2021 regarding the outlook for the coming 12 months. Furthermore, a renewed rise in outstanding business suggests that activity growth is likely to be sustained in the near term.
This encouraging survey arrives ahead of official regional unemployment figures, which have shown the North East experiencing rising unemployment for three consecutive months. The data also aligns with other positive signs for the UK economy, including growth in the national services sector reaching its highest level in a year.
