The North East economy returned to growth and confidence levels have reached their highest point in more than four years, an influential business survey suggests.
NatWest’s North East Growth Tracker, which measures change in the region’s manufacturing and service sectors, increased from 49.3 in September to 52.3 in October, with scores above 50 signalling growth in the region’s private sector activity. The expansion in activity in the North East outpaced the Ƶ average, with only London and the South East seeing greater increases in activity than the North East.
The rise in work came alongside a further easing in inflationary pressures, NatWest said, which contributed to renewed employment growth. The rise in headcounts in the North East contrasted with falling staffing numbers at a national level, the survey reported.
The increase in business activity was the third recorded by NatWest in the past five months, and the strongest since November 2024, fuelling hopes that the region’s economy is beginning to turn a corner.
Malcolm Buchanan, chair of the NatWest North regional board, said: “The North East entered the final quarter of 2025 on stronger footing, according to data from the NatWest Growth Tracker. New business placed with private sector firms rose for the second time in three months, and at the strongest rate since November 2024, driving a renewed increase in business activity.
“Firms also signalled receding cost pressures during October, which contributed to the slowest rise in output charges in just under five years. Positivity filtered through to the latest survey, with companies expressing stronger confidence regarding the outlook for activity over the coming 12 months.
“North East private sector firms were at their most upbeat since May 2021. In turn, businesses raised employment levels in October, ending a 10-month sequence of job shedding. Evidence of capacity pressures building was also highlighted through a renewed rise in outstanding business, suggesting that activity growth looks set to be sustained over the near term.”
The NatWest survey has been published ahead of monthly figures on regional unemployment, with the North East having seen rising unemployment for three consecutive months.
But there have been growing signs of positivity around the Ƶ economy, with growth in the country’s services sector last week coming in at its highest level in a year. Manufacturing production increased for the first time in a year last month but there was an unexpected drop in activity in the construction sector.
