- Final Services PMI 52.5 vs 53.2 expected
- Prior 51.0
- Final Composite PMI 51.5 vs 52.0 expected
- Prior 50.5
Key findings:
- Modest expansion of service sector business activity
- New work rises for first time in three months, but
job cuts continue - Steep increase in input prices, driven by higher
payroll costs
Comment:
Tim Moore, Economics Director at S&P Global Market
Intelligence, said:
“March data revealed an acceleration in UK service sector
growth to its fastest since August 2024 as a renewed
upturn in new orders helped to boost overall business
activity.
“However, the subsequent modest recovery in private
sector output has been sustained by a relatively narrow
segment of the UK economy, primarily technology and
financial services. Transportation, leisure and hospitality
firms reported weak business conditions in March,
while the manufacturing sector saw its fastest drop in
production since October 2023.
“Service providers reported a range of constraints on
growth, including stretched household budgets, risk
aversion among corporate clients and rising geopolitical
uncertainty. Service businesses also remained cautious
about the near-term outlook, with optimism still among
the lowest seen over the past two years. Worries about
increasing wages and the impact of forthcoming US tariffs
were the most cited challenges in March.
“A combination of subdued order books and elevated input
cost inflation led to cautious recruitment policies. Job cuts
have now been recorded for six months in a row, reflecting
a sustained period of hiring freezes and redundancies.
“The survey’s inflation trackers for the service economy
were again much stronger than seen in the decade prior
to the pandemic. Efforts by suppliers to pass on higher
payroll costs were widely reported as a factor leading to
increasing prices charged in March.”
UK Composite PMI