15 November 2001 | Robin Parker
Business activity on both sides of the Atlantic has suffered in the month after the US terrorist attacks, with the services sector particularly badly hit, according to the latest figures.
The UK, US and euro-zone purchasing managers' indices (PMI) for the non-manufacturing sector recorded their lowest ever figures in October. The manufacturing sector continued to contract, and the index hit record lows in Ireland, the Netherlands and Denmark.
The CIPS/NTC Research PMI showed that UK services contracted for the second successive month, dropping to 46.3, its lowest ever and further below the 50 mark that indicates no change, owing largely to the reduced tourist trade.
Services' decline was more pronounced in the US, particularly after the National Association of Purchasing Management (NAPM) had reported a surprise upturn in September. In October, its index fell 9.6 points to 40.6.
Norbert Ore, chair of the NAPM's manufacturing business survey committee, urged buyers to conduct rigorous risk assessments of their supply chains.
"Supply management has never been more important and it is vital that we examine the security of our supply arrangements."
But Mark Berrisford-Smith, senior economist at HSBC, questioned the extent of the decline. "It's no surprise that figures are the lowest ever, but while hotels and airlines are having a really bad time, most areas of services are keeping their heads above water," he said.