While a new report shows that nearly three quarters of Yorkshire’s small and medium businesses expect to grow over the next three months, another study warns of an increasing skills gap.

The latest quarterly Business Factors Index from Bibby Financial Services, featuring feedback from more than 1,000 business owners, found regional SMEs had a positive outlook following a successful first quarter which saw 48 per cent of firms increase sales.

A quarter of firms had recruited more staff, with 11 per cent planning to take on more employees.

The report also shows that 24 per cent of Yorkshire SMEs have invested in their current workforce, with 46 per cent investing in premises, equipment or technical services.

Bibby said 20 per cent were predicting significant growth over the next quarter with 57 expecting sales to increase and 67 per cent planning to invest, including 29 per cent looking to recruit.

Mark Storey, of Bibby Financial Services Yorkshire, said: “The findings of our research for quarter one 2014 reflect national SME performance according to our headline index data, which recorded the highest level of first quarter output among our 4,000 invoice finance clients since 2008.

“However, if SMEs in Yorkshire and Humberside are going to realise their growth ambitions, it is important they have access to funding that supports the development of their business.”

While most UK businesses are planning a hiring spree over the next 12 months, nearly two thirds are worried about skills shortages, a new PwC survey of 1,300 chief executives reveals.

With skills, such as technology and data analytics, in high demand but short supply, UK businesses are widening their search for skilled people and looking to Indonesia, Vietnam and the Philippines for new talent.

Rupert Hutton, PwC human resource services director in Leeds, said: “CEOs believe the gap between the skills of the UK workforce and the skills their businesses need to achieve growth is widening.

“Competition for talent will be intense. People with tech-based skills, such as cloud computing, mobile technology and data analytics, will be in strong demand but this is also the area with the biggest skills shortage."