Lloyds Bank England and Wales Regional PMI
11 November 2013
Sharp increase in business activity sustained across England and Wales
- Record rise in combined business activity in the English regions
- Strong growth in business activity maintained in Wales
- Job creation hits record levels across both England and Wales
Business activity rose across England and Wales in October, according to the latest Lloyds Bank Commercial Banking Regional Purchasing Managers’ Index® (PMI®), with the English regions as a whole recording the strongest growth since the survey began in January 2001. In Wales, private sector output growth also remained strong, although the pace of expansion eased slightly from the four-year high seen in September.
The headline index measuring overall business activity across the English regions reached 61.8 in October, compared to 60.7 in September, remaining above the 50.0 no-change mark for the twelfth consecutive month. The latest reading also indicated the strongest growth in business activity in almost 13 years of data collection.
All nine English regions registered strong increases in business activity during October. The strongest expansion was in London (65.0), followed by the East Midlands (63.9), while the North East once again saw the weakest rise in output (55.3).
The headline index for Wales recorded 59.1 in October, which was little-changed from September’s four-year high of 59.2. The index has now remained above the neutral 50.0 mark for 15 months running, with the latest reading indicating a strong increase in private sector activity across the country.
Higher levels of business activity were driven by survey-record growth of new orders across the English regions as a whole. London witnessed the strongest expansion of incoming new work (66.4), followed by the South East (64.4) and South West (63.3). In Wales, new business growth remained strong, but eased slightly from September’s recent peak.
The latest survey highlighted that job creation remained robust across England (55.5) and Wales in October (55.2), and was the strongest seen in almost 13 years. London (57.7) and the South East (56.3) recorded the sharpest increases in private sector employment.
Solid rises in average cost burdens were seen across both the English regions (56.5) and Wales (55.0), which survey respondents mainly linked to higher raw material prices and increased utility bills. This led to an increase in private sector output charges across England and Wales, but overall inflationary pressures remained relatively moderate.
Tim Hinton, Managing Director, SME & Mid Markets Banking, Lloyds Banking Group, said:
“It is encouraging to see that private sector businesses have maintained the strong momentum they built up through the summer, as robust growth in business activity continued right across England and Wales last month.
“While London retained its place as the best performing region, underlying economic conditions are improving throughout the UK, indicating that the upturn is still broad-based across the manufacturing and service sectors.
“This was confirmed by five of the nine English regions registering record growth in new business in October, while strong increases in new orders were also seen elsewhere across the UK.
“A sustained period of demand growth is starting to encourage private sector job creation across the UK, which is an encouraging sign that businesses expect continued increases in business activity during the final quarter of 2013 and beyond.”