Yorkshire's Post-Pandemic Surge in Small Businesses: An Economic Rebound Outstripping Pre-Covid Levels

Yorkshire and the Humber are witnessing a significant post-pandemic resurgence in small and medium-sized enterprises (SMEs), with recent research highlighting a robust growth trajectory.

The region has not only recovered but surpassed pre-pandemic levels, with over 6,500 more SMEs compared to 2019. This boom is paralleled by an increase in employment, marking a clear rebound in the local economy.

SME growth in Yorkshire: A post-pandemic success story

The latest analysis from iwoca, one of Europe’s leading small business lenders, reveals that the number of SMEs in Yorkshire and the Humber has grown by 4% between 2019 and 2023. This surge equates to a substantial increase of more than 6,500 businesses, pushing the region’s total to over 158,000 SMEs. These figures reflect a promising trend, as Yorkshire now leads the North of England in small business growth since the pandemic.

Doncaster has emerged as the frontrunner in this regional boom, with an impressive 11.3% increase in SMEs, followed closely by Hull and Sheffield. The data highlights Yorkshire's resilience and adaptability in the face of economic challenges, particularly in sectors like transportation and construction, which have driven much of this growth.

Yorkshire's employment surge

Yorkshire’s burgeoning small business scene has also contributed to a notable increase in employment. The region's workforce has expanded by nearly 69,000 since 2019, representing a 9.6% rise. As of the latest figures, Yorkshire is home to almost 2.3 million employed individuals, a clear indicator of the region’s economic recovery.

The growth in SMEs is not just a numerical increase but reflects a broader economic vitality. Sectors such as transportation and storage, which have seen the most significant SME growth in over half of Yorkshire's local authorities, have been pivotal in this employment surge. The rise of online deliveries during the Covid-19 lockdowns likely spurred this growth, particularly in areas like Doncaster and Hull, where these sectors have thrived.

Doncaster: Leading the charge in SME growth

Doncaster stands out as the leader in SME growth within Yorkshire, boasting an 11.3% increase in small businesses from 2019 to 2023. This growth is not only a testament to the town’s strategic advantages but also its proactive local governance. Doncaster's rise has been supported by its new city status, excellent transport links, and ambitious regeneration projects such as the iPort and Unity.

Sally Jameson, MP for Central Doncaster, expressed her enthusiasm for the town's progress, noting the positive environment for businesses fostered by local initiatives. She highlighted the role of local education institutions, such as Doncaster College and Doncaster UTC, in equipping the workforce with the necessary skills to support ongoing business growth.

Moreover, Jameson pointed to the Launchpad programme, funded by the City of Doncaster Council, as a crucial resource for budding entrepreneurs in the region. This programme, in conjunction with the Doncaster Chamber of Commerce's Economic Strategy 2030, aims to create a thriving business ecosystem that continues to attract and nurture small businesses.

Hull and Sheffield: Close contenders in SME expansion

While Doncaster leads, Hull follows closely with a 10.9% increase in SMEs, largely driven by the transportation and storage sector. This growth underscores Hull’s economic resilience and its ability to capitalize on the post-pandemic recovery. Sheffield, ranking third, has also seen significant growth, particularly in the wholesale and retail trade sectors, reinforcing its status as a key economic hub within the region.

The expansion of small businesses in these cities highlights the broader trend across Yorkshire, where local authorities have effectively supported SMEs, enabling them to flourish in a challenging economic environment. The diversity of growth across different sectors also illustrates the region's economic adaptability and the varied opportunities available to entrepreneurs.

Regional economic strategy: The path forward

The success of small businesses in Yorkshire is not just a reflection of market dynamics but also of strategic planning and support from local authorities. The City of Doncaster Council, for instance, has laid out a comprehensive economic strategy aimed at sustaining and furthering this growth. The reopening of Doncaster Sheffield Airport is a key element of this strategy, expected to provide a significant boost to the local economy and create more jobs.

Seema Desai, COO of iwoca, emphasized the importance of these developments, noting that Yorkshire's recovery, particularly in sectors like transportation, is crucial for long-term job creation and economic stability. The region’s performance is a testament to the resilience of its business community and the effectiveness of targeted economic policies.

Tables: A detailed look at Yorkshire's SME and employment growth

Overall Rank	Local Authority Name	Total SMEs (2019)	Total SMEs (2023)	SME Creation Rate 19–23 (%)	Top Sector for New SMEs (19–23)
1	Doncaster	8,960	9,975	11.33%	Transportation and storage
2	(Kingston upon) Hull	5,980	6,630	10.87%	Transportation and storage
3	Sheffield	15,855	16,935	6.81%	Wholesale and retail trade
4	Rotherham	7,070	7,525	6.44%	Transportation and storage
5	Barnsley	6,380	6,790	6.43%	Construction
6	Bradford	15,660	16,580	5.87%	Wholesale and retail trade
7	Kirklees	14,595	15,290	4.76%	Transportation and storage
8	North Lincolnshire	5,420	5,665	4.52%	Transportation and storage
9	Wakefield	9,550	9,865	3.30%	Construction
10	North East Lincolnshire	4,555	4,675	2.63%	Transportation and storage

Local Authority Name	Total Employment Figure (2019)	Total Employment Figure (2022)	Change in Employment Figures (19–22)	% Increase
Doncaster	123,550	135,450	11,900	9.63%
(Kingston upon) Hull	124,840	129,540	4,700	3.76%
Sheffield	272,320	272,255	-65	-0.02%
Rotherham	102,300	105,300	3,000	2.93%
Barnsley	85,490	88,455	2,965	3.47%
Bradford	201,650	213,660	12,010	5.96%
Kirklees	162,950	163,775	825	0.51%
North Lincolnshire	76,375	74,950	-1,425	-1.87%
Wakefield	157,250	165,975	8,725	5.55%
North East Lincolnshire	68,300	68,810	510	0.75%

The role of iwoca in supporting SME growth

As a leading provider of small business financing, iwoca has played a crucial role in empowering SMEs across the UK. The company’s commitment to fast, flexible finance has enabled thousands of businesses to manage cash flow more effectively and seize growth opportunities.

Since its inception in 2012, iwoca has provided billions in funding to over 100,000 businesses, positioning itself as a key player in the fintech industry. The company's mission to finance one million businesses is well underway, with its innovative use of technology and data science driving accessibility and relevance for SMEs.

Yorkshire's SME boom and corresponding employment growth signal a strong post-pandemic recovery. The region's resilience, coupled with strategic support from local authorities and financial institutions like iwoca, has paved the way for sustained economic development. As Yorkshire continues to nurture its small businesses, the region is well-positioned to build on this momentum, ensuring a prosperous future for its economy and workforce.