UK service companies have reduced employment for the fifth consecutive month, according to the latest S&P Global Purchasing Managers’ Index (PMI) for February.
The data from the survey emphasizes what economists describe as a “loss of growth momentum” since the autumn budget, in which some companies adopt the £ 25 billion of £ 25 billion in the national insurance policies of employers as key factor.
This long-lasting spell of job losses is the most long-term period of contraction since the beginning of 2011, with the exception of the COVID-19 Falling. Tim Moore, director of the economy at S&P Global Market Intelligence, says that less optimism and continuous cost pressure “have led to net jobs in February.”
Despite these figures, some analysts penetrate caution for the apparent gloom from the PMI. Rob Wood, Chief UK Economist at Pantheon Macro economy, points out that the index only asks how many companies cut the output or employment, instead of how much. ” Official data from the Office for National Statistics indeed suggest that unemployment remains almost a historic low of 4.4 percent.
The last services PMI lecture was up to 51 in February from 50.8 in January, which remain above the 50-point threshold that separates extension from contraction. However, it was something under the provisional “flash” lecture. The composite PMI, which measure the activity over the entire British private sector, slid marginal to 50.5 of 50.6.
Economists note that the Chancellor is now concentrating on potential cuts on government spending in the run -up to the spring statement on March 26 to maintain its tax goals. The office for budget responsibility is expected to warn that its margin of error of £ 9.9 billion since October may have been eroded, due to higher returns of the government bonds and the softer economic growth forecasts.
Thomas Pugh, an economist at Consultancy RSM UK, notes that the lukewarm PMI performance implies the economy in the first quarter “remained the flat”, but he suspects that the survey underlying the underlying power of economic activity underestimates. In the meantime, analysts suggest that President Trump’s rates in particular have weighed British production, a sector that is more vulnerable to potential import duties and the uncertainties of global trade.