Though new business and activity rose in this month's Markit/CIPS Purchasing Managers’ Index® (PMI®) for the services sector, confidence continues to remain low.
The report posted a reading of 53.0, down slightly from October's 53.2 as job cuts were announced, and worries over public sector cuts remain.
David Noble, CEO of CIPS said:
"Once again, UK services growth was far from spectacular in November. This trend may start to take a heavy toll on business confidence as we head into the New Year.
"Profits will be squeezed for many businesses, not least due to higher utility bills and the VAT increase and there is limited scope to pass on any additional costs to customers. Forward looking indicators are already showing signs of instability, with purchasing managers reporting weak consumer demand. This is worrying as we would expect demand to be higher during the Christmas period.
"Businesses that are heavily reliant on consumer and public spending will increasingly become the poor relations, particularly compared with those in transport, communications and business services, who have benefitted this month from better growth in the manufacturing sector. A mixed picture of the economy overall, with no cause for celebration yet."
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