5 April 2011 | Lindsay Clark
Activity in the UK services sector accelerated at its greatest pace for more than a year in March, a survey of buyers found.
The Markit UK Services PMI recovered from its weak growth in February (52.6) and rose to 57.1 last month – its strongest performance for 13 months.
Comfortably above the crucial no-change mark of 50, it means the feared weakening of the services sector in response to government cuts has abated for the time being. More activity was the result of increased business enquiries and higher levels of new work.
CIPS chief executive David Noble said: “A complex array of forces were at play in the UK services sector last month, resulting in the strongest rate of growth for over a year, but also a further squeezing of profit margins.
“Where possible companies tried to avoid passing on higher costs due to highly competitive market conditions.”
Although there was a marginal increase in recruitment for the first time in nine months, there are likely to be a few wobbles to come, not least as businesses wait to see the true impact of government spending cuts over the summer months, Noble added.