The country’s services industry – which spans businesses from pubs, restaurants and hairdressers to transport, real estate and insurance – continued to drive an uplift across the broader private sector
The UK’s private sector has grown steadily this month, showing signs that the economy has pulled out of last year’s “brief recession”, according to a new survey.
The S&P Global/CIPS flash UK purchasing managers’ index (PMI) for March was 52.9, a fraction down from February’s 53.0. The numbers are an indicator of business activity. If the score is under 50, things are slowing down. If it’s over 50, they’re picking up. Experts thought the PMI would be 53.2 for March, but it was a little less.
Services like pubs, restaurants, hairdressers, transport, real estate, and insurance are helping the whole private sector do well. But in March, things started to slow down a bit because households don’t have as much money to spend. Even so, manufacturing increased for the first time in over a year.
This could mean that factories are starting to turn a corner after facing rising costs and supply problems because of disruption in the Red Sea. Chris Williamson, who’s the chief business economist at S&P Global Market Intelligence, said: “Further signs of the UK economy having pulled out of last year’s brief recession are provided by the provisional PMI data for March.”
Recent official figures revealed that our country hit technical recession at the end of last year. This is when we have two quarters in a row with negative growth. Mr. Williamson added, “It is also encouraging to see a more broad-based expansion, with a sustained increase in service sector activity accompanied in March by signs of a tentative return to growth for manufacturing output,”.
However, even though the fears of recession seem to be easing, he highlighted that inflation remains a worry. He said: “Stubbornly sticky service sector inflation has persisted into March, exacerbated by renewed inflation in the manufacturing sector.”
He also said all businesses would be hoping to see some definite signs of wage growth slowing down. Echoing Mr. Williamsons nod to recovery, Thomas Pugh, an economist at RSM UK, commented: “The PMIs are still pointing to a return to growth in the first quarter of this year, adding to evidence that last year’s recession is already over.”
Taking an optimistic tone, he predicted: “We expect the economy to gradually pick up steam over the rest of the year as lower inflation, falling interest rates and tax cuts boost consumer spending.”
