Monday, July 6, 2020

Private sector activity falls at a sharper pace

Private sector activity continued to fall in the three months to October (-11%), at a sharper pace than in the previous rolling quarter, according to the CBI’s latest monthly Growth Indicator.

The composite measure, based on 507 respondents, reported the twelfth consecutive rolling quarter – equivalent to a full year – of flat or falling volumes. The deterioration in this month’s survey reflected a sharp decline in manufacturing output and consumer services business volumes, coupled with a further drop in retail sales and business and professional services volumes.

Looking forward, private sector activity is expected to drop at a faster pace in the quarter to January 2020 (-17%) – the weakest expectations since December 2011, though very close to last month’s expectation (-16%). This reflects expectations of a faster decline in manufacturing and business and professional services volumes, alongside a continued fall in consumer services volumes. Retail sales are expected to stabilise.

Across the economy more broadly, growth has been volatile during 2019, driven by shifting activity in response to moving Brexit deadlines. We expect the economy to grow modestly in the event of a smooth transition to a new Brexit deal, with the longer term economic impact dependent upon the details within the final deal.

Anna Leach, CBI Deputy Chief Economist, said: “The squeeze on the private sector continues to tighten, with our growth indicator showing that volumes have been flat or falling for a full year. And with expectations for activity at their lowest in nearly eight years, it’s clear businesses are worried about the future.

“The drops across the manufacturing, retail and dominant services sector, paired with the hugely damaging effect of Brexit uncertainty, are ingredients for a perfect storm for British firms.

“The General Election is an opportunity for all parties to present their visions for the UK’s future. Passing a good deal with the EU is the first step. Then the real heavy lifting can begin, building a future relationship with our biggest trading partner. Ending political instability will enable a renewed focus on domestic priorities, which will give the economy the boost it needs.”

A message from the Editor:

Thank you for reading this story on our news site - please take a moment to read this important message:

As you know, our aim is to bring you, the reader, an editorially led news site and magazine but journalism costs money and we rely on advertising, print and digital revenues to help to support them.

With the Covid-19 lockdown having a major impact on our industry as a whole, the advertising revenues we normally receive, which helps us cover the cost of our journalists and this website, have been drastically affected.

As such we need your help. If you can support our news sites/magazines with either a small donation of even £1, or a subscription to our magazine, which costs just £31.50 per year, (inc p&P and mailed direct to your door) your generosity will help us weather the storm and continue in our quest to deliver quality journalism.

As a subscriber, you will have unlimited access to our web site and magazine. You'll also be offered VIP invitations to our events, preferential rates to all our awards and get access to exclusive newsletters and content.

Just click here to subscribe and in the meantime may I wish you the very best.




Latest news

New state of the art visitor centre a step closer for Lincoln Cathedral

Another major phase of works to Lincoln Cathedral as part of the £16.5m Connected project, of which £12.4m is funded by The National Lottery,...

University launches virtual version of popular accelerator to boost business recovery.

Leeds Beckett University is urging the region’s young businesses to sign up for the third cohort of its popular accelerator programme. Launching in late July,...

Enrolment opens for 4D Pharma’s phase II study of live biotherapeutic in COVID-19

4D Pharma, the listed Leeds-based pharma company developing Live Biotherapeutics, has announced that its Phase II clinical trial of oral immunomodulator MRx-4DP0004 for patients...

£75m investment secured for South Yorkshire

Mayor Dan Jarvis and the Sheffield City Region Mayoral Combined Authority have secured more than £75 million of Government funding to improve open spaces,...

Leaders in the Midlands and North demand early start to HS2 to help regions rebound

Political leaders in the Midlands and the North are demanding an early start to HS2 as new research shows the eastern leg of the...

Promise of post-pandemic ‘green recovery’ must be quick, report urges

Promises of a ‘green recovery’ from the coronavirus downturn must offer quick and tangible financial benefits and job opportunities, a new report argues. The Social...

Related news

New state of the art visitor centre a step closer for Lincoln Cathedral

Another major phase of works to Lincoln Cathedral as part of the £16.5m Connected project, of which £12.4m is funded by The National Lottery,...

University launches virtual version of popular accelerator to boost business recovery.

Leeds Beckett University is urging the region’s young businesses to sign up for the third cohort of its popular accelerator programme. Launching in late July,...

Enrolment opens for 4D Pharma’s phase II study of live biotherapeutic in COVID-19

4D Pharma, the listed Leeds-based pharma company developing Live Biotherapeutics, has announced that its Phase II clinical trial of oral immunomodulator MRx-4DP0004 for patients...

£75m investment secured for South Yorkshire

Mayor Dan Jarvis and the Sheffield City Region Mayoral Combined Authority have secured more than £75 million of Government funding to improve open spaces,...

By continuing to use the site, you agree to the use of cookies. more information

The cookie settings on this website are set to "allow cookies" to give you the best browsing experience possible. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this.

Close