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07 Apr 2021 | 09:33

UK services sector returns to growth in March

(Sharecast News) - The UK services sector returned to growth in March as new orders rose ahead of lockdown easing, according to a survey released on Wednesday. The IHS Markit/CIPS services PMI business activity index increased to 56.3 from 49.5 in February. This was a touch below the flash reading of 56.8 but above the 50.0 level that separates contraction from expansion for the first time since October 2020.

The composite PMI - which measures activity in the services and manufacturing sectors - printed at 56.4 in March, up from 49.6 in February. It was above the 50.0 mark for the first time this year.

Tim Moore, economics director at IHS Markit, said: "UK service providers were back in expansion mode in March as confidence in the roadmap for easing lockdown restrictions provided a strong uplift to new orders. Total business activity increased at the fastest rate since August 2020 and this return to growth ended a four-month sequence of decline.

"Forward bookings for consumer services and rising optimism about recovery prospects resulted in extra staff hiring across the service economy for the first time since the start of the pandemic. Business optimism improved for the fifth month running in March and was the highest since December 2006."
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