According to figures revealed today in Yorkshire Bank's inaugural Business Confidence Index just three per cent believe conditions will actually be easier, although an encouraging 40 per cent remain optimistic about their prospects.
Across the UK as a whole 60 per cent of SME businesses believe trading conditions will be harder yet just under half (46%) remain positive about their prospects in the coming year.
"It's hardly surprising that UK SMEs are expecting a bit more turbulence in their markets. For the past five years the UK has been both economically and politically stable; house prices continued to rise steadily and interest rates were, up until the start of the year, at expected levels. However, since the start of the year we've seen five rate rises, the US sub-prime market collapsed and some banks, particularly on complex and high-value deals, started to look closely at their lending criteria and push back on a number of requests," said Kath Myers, regional director for Yorkshire Bank.
Thirty-eight per cent of businesses in Yorkshire believe that the UK is now a less attractive place to do business than five years ago. Only three per cent feel the country is now a more attractive place for their businesses - this is significantly lower than the national average of 17 per cent.
"It's easy to risk talking ourselves into recessionary conditions and while it's clear the perception is one of worsening conditions, the actions and optimism of Yorkshire businesses indicate they are ready to meet these challenges head on," concluded Kath Myers.