In recent decades Yorkshire and the Humber has suffered, along with other regions, from the decline in the traditional industries such as coal, steel and textiles. However, the region's communities are beginning to adapt to the new economic climate supported by investment from the EU, which will total over £325 million between 2001 and 2006. A further investment of around £561 million is expected from the public and private sectors during the same period. Such investment aims to promote economic diversification, create employment and fund the development of the region's neediest communities. One of the main objectives is to increase the number of new companies setting up in the region and to improve the survival rate of such companies. The target is for 14,000 new VAT-registered business to be created every year by 2010, while it is hoped the number of firms surviving more than three years will increase from 59.7 per cent to 63 per cent by 2005 and to 70 per cent by 2010.

Under the guidance of the region's development agency, Yorkshire Forward, a number of strategies are being employed to achieve these aims. These include helping to establish research partnerships between the region's universities and business, creating specialist training programmes to improve the skills of the workforce and the launch of regional centres of excellence and business incubators. Figures released by Yorkshire and Humber Assembly show that such measures seem to be working. The number of businesses created in the region in 2000 was 660, up 5.5 per cent on the number created in 1996. More specifically, North Yorkshire, South Yorkshire and West Yorkshire saw an increase on 1996 figures of 11.08 per cent, 4.2 per cent and 7.13 per cent respectively, but in Humberside the number fell by 1.3 per cent. Overall survival rates in the region have improved but remain below the UK average.

Economy:
The region's GDP was approximately £58 billion in 2000, about 7.5 per cent of the total for the UK, and unemployment has been falling steadily over the last few years. Between 1996 and 2001 the ILO unemployment figures fell from 8.2 per cent to 5.1 per cent, while the claimant count fell from 7.8 per cent to 4 per cent during the same period.

The region's service sector has been growing significantly and now includes one of the largest financial and legal centres in the country, based in the city of Leeds. West Yorkshire is attracting internet companies such as Freeserve and Firstnet. The Californian based company R-Quest recently established its new engineering sales and support centre in York. Several large call centres have been set up in Hull and the city is in a good position to develop this industry. Research conducted by Mitial Ltd has established that Hull can support a further 4,000 call centre positions, of which 400 could be multi-lingual. The city's call centre wage rate is also 20 per cent below the average for the UK.

Tourism in the region as a whole has also been growing and, according to the DTI, is worth £2 billion a year and supports approximately 140,000 jobs.

Whilst the manufacturing industry has declined in importance in recent decades it remains relatively large and diverse. For example, the region is home to several large chemical companies including Syngenta, BP and Novartis and is responsible for some 10 per cent of the UK's chemical output. There is also a thriving engineering and metals cluster, which accounts for between 35 and 40 per cent of the region's gross value added in manufacturing. This cluster encompasses everything from the processing of various metals and alloys to the manufacturing of high tech products for the aerospace, automotive and household appliances sectors. The Biosciences cluster is developing as the region's universities produce a growing number of spin-off companies. At present, according to Yorkshire Forward, there are more than 100 bioscience companies, which together employ over 8000 people. In May 2002, a new biocentre was opened at York Science Park, providing flexible laboratory and office space, meeting rooms and state of the art telecommunications facilities.

The Food and Drink Cluster is the main source of employment in the rural and coastal areas of the region, providing jobs in areas such as manufacturing, wholesale, retailing and agriculture. The agricultural industry in the region benefits from EU support in the form of subsidies worth in excess of £380 million per annum.

Local Infrastructure:
According to a report published by the Department for Transport in 2001, Yorkshire and the Humber handles just 2.5 per cent of all aircraft traffic in Great Britain, catering for approximately 2 million passengers and nearly one thousand tonnes of freight annually. The three international airports in the region are Leeds Bradford International Airport, Humberside Airport and Sheffield Airport.

The Humber estuary has several port facilities based at Goole, Grimsby, Hull and Immingham, which, according to the Department of Transport, handle approximately 13 per cent of UK sea-borne trade, totaling between 70 - 80 million tonnes of cargo a year. The ports ship goods to over 50 countries including some in South America, North America and the Far East. Most European cities can be reached in less than a 24 hours.

The region, located at the intersection between the main London to Edinburgh and Trans-Pennine routes, benefits from excellent road and rail links to the rest of the country and beyond. The capital cities of London and Edinburgh are both less than four hours drive away, while Doncaster International Railport and Wakefield Europort link rail freight through the channel tunnel to northern France and on to the rest of Europe.

Local Workforce:
The region's workforce totals over 2.4 million people. Male employees work approximately 41.5 hours per week on average and females about 37.5. Just over 50 per cent of the working population are educated to at least A level standard and around 12 per cent have no qualifications at all. However, according to the Federation of Small Businesses' Yorkshire and Humber Policy Unit, 48 per cent of small business owners in the region are dissatisfied with the literacy and numeracy skills of the workforce. The Regional Development Agency Yorkshire Forward is in the process of tackling such problems, in association with the region's four Learning and Skills Councils, and as of mid 2001 had awarded £7.5 million to more than 30 skills and learning projects in the region.

Business Costs:
The cost of office space in Yorkshire and the Humber compares favourably with much of the UK. A survey conducted by City University Business School and Actium Consult in 2001, for example, gave Leeds a combined office rental and rate cost of £337.19 per annum per metre squared, compared with £858.99 for the city of London, £439.92 for Edinburgh, £350.65 for Manchester and £257.06 for Cardiff.

Wage costs are the second lowest of any region in England, with average earnings being just over 88 per cent of the average for Great Britain during 2001.