Lloyds Bank Commercial Banking England and Wales regional PMI
09 September 2013
- Combined business activity of the English regions increased at the strongest rate since 2001
- Wales recorded strongest increase in output since September 2009
- Job creation seen across Wales and all English regions, led by the West Midlands
The combined business activity of the English regions increased at a record rate in August, according to the latest Lloyds Bank Commercial Banking Regional Purchasing Managers’ Index® (PMI®) survey, while Wales recorded its strongest rate of expansion for almost four years.
The headline index measuring overall business activity across the English regions rose to 61.0 in August, signalling the strongest growth since the series began in January 2001. This was also a significant rise compared to last month’s index reading of 60.0. Furthermore, the index has now posted above the 50.0 ‘no-change’ mark for ten consecutive months, and the latest reading reveals that the strong rebound in economic conditions seen over the summer of 2013 continues.
In Wales, overall business activity rose marginally to 57.7 in August from 57.6 in July, remaining above the 50.0 ‘no-change’ mark for the thirteenth successive month. August saw the strongest rise in the combined output of Welsh manufacturing and service sector businesses since September 2009.
Of all the English regions, the North West saw the strongest rate of expansion last month (64.0), followed by the South East (62.7). Companies in the North East recorded the slowest rise in business activity (56.3), followed by those based in Yorkshire & Humber (57.3).
Survey respondents cited a wide range of factors that had boosted recent business activity, including higher consumer demand and greater investment spending amongst both public and private sector clients. Some firms also reported rising volumes of export sales in August. All areas of England and Wales reported an increase in incoming new work, led by London (63.5) and the South East (62.6).
Private sector companies across all nine English regions took on new staff during August, with the West Midlands recording the strongest speed of job creation (55.1). In Wales, employment levels rose only slightly over the same period (50.1).
Private sector firms across all of England and Wales reported rising cost burdens in August, with the steepest rate in input price inflation seen in the East Midlands (58.1). Wales recorded a solid increase in average private sector tariffs (54.3), while all nine English regions also saw an increase, led by the North West (53.1). Higher costs were mostly linked to greater energy bills and increased staff salaries, which in turn led some manufacturers and service providers to raise their own output prices in August.
David Oldfield, Managing Director, SME & Mid Markets Banking, Lloyds Banking Group, said:
“Businesses across England and Wales took another step forward on the path to recovery in August, helped by improving conditions in both domestic and export markets.
“The strong growth seen in all the English regions is another sign that the country is returning to growth, as the combined rate of output expansion during August was the strongest for over a decade. Wales has also witnessed strong improvements this summer, with business activity increasing at the strongest rate for around four years.
“The most encouraging aspect of the recent increase in business activity is that it has fuelled job creation across the private sector. We have seen employment growth across England and Wales this summer and all the signs are that we should expect more of this good news over the coming months.”