A prominent survey reveals high export sales have helped the UK services sector record another strong month of recovery. The IHS Markit/CIPS Purchasing Managers’ Index (PMI) for UK services gave the industry reading of 58.5 in November, a modest fall of 0.6 points from October.
However, prices rose at their fastest pace in the survey’s 25-year history due to supply chain problems increasing the cost of raw materials, energy, and freight, as well as higher wages. Combined with widespread staff shortages, this has caused optimism regarding business activity expansion to retreat to its lowest level in a year.
Economics director at IHS Market, Tim Moore said, “The overall speed of recovery looks to have accelerated in comparison to the third quarter of 2021, with output growth mostly driven by services as manufacturers struggle with severe shortages of raw materials and critical components.”
The IHS Markit monthly PMI report on manufacturing gave the sector reading of 58.1, however, noted that input prices reached a three-decade peak. The report said British manufacturers have had to increasingly contend with shortfalls in staff and supply chain problems leading to more expensive items and finished products. The report suggested that fewer issues within the supply chain, planned marketing campaigns, business expansion, and innovation was among the commonly cited reasons for this upbeat sentiment.
