Activity growth within the services sector surged during march to its strongest for a year.
The Markit/CIPS Purchasing Managers’ Index® (PMI®) reading of 57.1 was a marked improvement on February’s 52.6. Strong levels of new business supported an increase of activity, however cost pressures remained elevated. Employment within the sector rose for the first time in 9 months.
David Noble, CEO of CIPS, 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.
“Leading performers such as business services seem to have been riding on the coat-tails of a stronger UK manufacturing sector in Q1; and meanwhile overseas demand for IT & Computing continued to boost confidence in that sector.
“It’s encouraging to see a marginal increase in recruitment for the first time in nine months but 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.”
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