3rd Apr 2025 10:00
(Alliance News) - Business activity in the UK private sector picked up in March led by further momentum in services, purchasing managers' index survey results from S&P Global showed on Thursday.
The UK services PMI business activity index registered 52.5 points in March, up from 51.0 in February and the highest reading since August 2024. A reading above 50-points indicates an increase in business activity compared to the previous month, and below 50 a decrease.
The final reading for March however was slightly below the earlier flash estimate of 53.2 points.
Survey respondents reported a gradual turnaround in demand conditions and a subsequent improvement in sales pipelines. Total new work increased for the first time in 2025 to date, albeit only marginally, which was helped by a modest rebound in export orders.
However, employment remained a weak spot with staffing numbers decreasing for the sixth month running, with survey respondents mostly citing the impact of rising payroll costs, due to changes announced in the UK government budget back in October.
S&P Global said the seasonally adjusted composite output index climbed to 51.5 points in March from 50.5 in February, the highest for five months. It was below the flash estimate of 52.0 points.
A marked decline in manufacturing production weighed on overall private sector output growth.
On Tuesday, S&P Global had said the UK manufacturing PMI fell to a 17-month low of 44.9 points in March from 46.9 in February. It however beat the flash estimate of 44.6.
Tim Moore, economics director at S&P Global Market Intelligence, said: "March data revealed an acceleration in UK service sector growth to its fastest since August 2024 as a renewed upturn in new orders helped to boost overall business activity."
"However, the subsequent modest recovery in private sector output has been sustained by a relatively narrow segment of the UK economy, primarily technology and financial services. Transportation, leisure and hospitality firms reported weak business conditions in March, while the manufacturing sector saw its fastest drop in production since October 2023."
The UK services PMI is compiled by S&P Global from responses to questionnaires sent to a panel of around 650 service sector companies. The responses are gathered in the second half of each month.
By Jeremy Cutler, Alliance News reporter
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