Growth in the UK\u2019s private sector slowed down last month as firms also accelerated job cuts in the face of higher costs, according to new figures.<\/p>\n
The S&P Global flash UK composite purchasing managers\u2019 index (PMI) reported a reading of 51 in July, sliding from a nine-month high of 52 reported in June.<\/p>\n
The flash figures are based on preliminary data. Any score above 50.0 indicates that activity is growing while any score below means it is contracting.<\/p>\n
The figures therefore pointed towards continued growth but at a slower rate.<\/p>\n
Firms linked job cuts to higher labour costs in last autumn\u2019s budget from Chancellor Rachel Reeves (Anthony Devlin\/PA) <\/p>\n
It was also weaker than expected by economists, who had predicted a reading of 51.8 for the month.<\/p>\n
Chris Williamson, chief business economist at S&P Global Market Intelligence, said: The flash UK PMI survey for July shows the economy struggling to expand as we move into the second half of the year.<\/p>\n
\u201cThe sluggish output growth reported in July reflected headwinds of deteriorating order books, subdued business confidence and rising costs, all of which were widely linked to the ongoing impact of the policy changes announced in last autumn\u2019s budget and the broader destabilising effect of geopolitical uncertainty.\u201d<\/p>\n
The data showed that growth was driven by the service sector in July, with firms highlighting an \u201cuptick\u201d in consumer spending.<\/p>\n
Nevertheless, service businesses said they still faced headwinds linked to \u201cfragile domestic economic conditions\u201d and wider uncertainty.<\/p>\n
Meanwhile, manufacturing production stabilised during the month after eight consecutive months of decline.<\/p>\n
Goods producers however said they were impacted by \u201cchallenging business conditions\u201d, particularly in major export markets due to the continued fallout of the US tariff changes.<\/p>\n
Surveyed firms reported a drop in overall new work from the private sector, slipping to its weakest level for three months.<\/p>\n
Lower levels of new work contributed to another drop in employment, with the survey showing the fastest rate of \u201cjob shedding\u201d since February, with job cuts across the manufacturing and service sectors.<\/p>\n
Companies cited that higher labour costs, following rises in national insurance contributions and the minimum wage, led to a number of workforce restructurings.<\/p>\n
Mr Williamson said: \u201cParticularly worrying is the sustained impact of the budget measures on employment.<\/p>\n
\u201cHigher staffing costs have exacerbated firms\u2019 existing concerns over payroll numbers in the current environment of weak demand, resulting in another month of sharply reduced headcounts in July.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Growth in the UK\u2019s private sector slowed down last month as firms also accelerated job cuts in the…\n","protected":false},"author":2,"featured_media":287637,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,4],"tags":[748,107445,393,4884,13196,1144,26166,619,712,16,15,1764],"class_list":{"0":"post-287636","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-uk","8":"category-united-kingdom","9":"tag-britain","10":"tag-chris-williamson","11":"tag-england","12":"tag-great-britain","13":"tag-job-cuts","14":"tag-northern-ireland","15":"tag-private-sector","16":"tag-rachel-reeves","17":"tag-scotland","18":"tag-uk","19":"tag-united-kingdom","20":"tag-wales"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/114907667739349963","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/287636","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=287636"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/287636\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/287637"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=287636"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=287636"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=287636"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}