UK business owner confidence has dropped to a three-year low, continuing to fall further each quarter, according to a survey In this climate, selecting the right location is crucial for entrepreneurs. So, where in the UK offers the best opportunities for business growth?

To find out, The Co-operative Bank has created a Business Growth Index, ranking 30 major UK cities based on key factors such as the number of high growth enterprises, five-year business survival rates, job openings, salary growth, unemployment rates and energy costs.

Leeds is the UK’s best city for business growth, with a five-year business survival rate of 38.5%

Leeds tops the list, offering a robust environment for business growth. The city recorded an impressive 205 high-growth enterprises in most recent data, the highest in the region, and currently has around 20,000 new job openings (4,510 per 100,000 people), indicating workforce demand and strong economic activity.

With a fairly low unemployment rate of just 3.8%, competitive energy costs at 23.86p per kWh, and ample room for growth, Leeds is emerging as a prime destination for business growth in the UK.

Edinburgh takes second place, with the lowest unemployment rate of 2.6%, the highest salary growth at 9.7%, and a 38.6% business survival rate. The Scottish capital also has 13,093 new job openings, offering an abundance of opportunities for talent, and boasts competitive energy costs at 24.31p per kWh.

Sheffield follows in third with an impressive 44.6% five-year business survival rate. Yorkshire, its region, also has competitive energy prices at 23.86p per kWh and 7.3% salary growth, appealing to entrepreneurs seeking stability and growth.

Lisa Galley, Head of Business Banking Products, said:

“With the Budget now delivered, entrepreneurs in places like Liverpool and Birmingham – where it remains more challenging for new businesses to flourish – will be reflecting on how it will impact them. While some measures, like a permanent reduction in business rates across the retail, leisure, and hospitality sectors, will offer some welcome relief. However, the Budget also brought with it some challenging updates, including the increase to the national minimum wage which will inevitably have a direct impact on payroll costs.

“Many business owners will now be assessing how the changes balance out in practice, particularly in regions needing a boost to their growth and competitiveness.”

For more insights on the best cities for business growth and additional ways to help scale your business, explore the full research here.