Yahoo Finance Decline in UK private sector activity slows in three months to November
Private sector activity in Britain fell at a slower pace in the quarter to November than in previous months.
Research from the Confederation of British Industry (CBI) shows activity in the three months to November declined slower compared to October to -16% from -29%.
The survey of 620 companies revealed that sales in the distribution sector grew at the fastest rate since last year May to +10% from -12%.
Meanwhile, the decline in manufacturing (-6% from -8%) and consumer services (-42% from -45%) remained similar to previous months.
Business and professional services activity fell at a much slower rate to -21% from -40%.
CBI’s monthly Growth Indicator said the pace of the downturn is expected to pick up again to -24%, with distribution sales sliding back into the red to -16%.
Looking ahead, the pace of decline is expected to rise in manufacturing to -10%, while activity is expected to fall at a similar pace in business and professional services (-25%) and consumer services (-46%).
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CBI lead economist, Alpesh Paleja, said: "While the quarterly decline in private sector activity appears to have eased, it's likely that some of our surveys capture demand brought forward before the second English lockdown came into force. It’s clear that many businesses have seen a hit since, as illustrated by the continually steep fall in consumer services activity.
“With a new tier system in place from December, businesses facing ongoing restrictions must receive the financial support that they need to make it through to the Spring. Firms will also need to know what support will be available beyond this in advance, rather than it going to the wire. Getting this right now will build the foundations for a sustainable post-COVID economic recovery.”
A separate research showed that the UK’s economic recovery is facing a ‘double-dip’ downturn as coronavirus lockdowns batter firms.
Industry data from IHS Markit points to the sharpest decline in private sector output since May as economic restrictions left firms reeling after four months of expansion.
It said trade took the biggest hit for firms in services, which makes up four-fifths of the economy from cafes to shops to art galleries.
Meanwhile, private sector employment slid at the fastest rate in three months as redundancies grew, despite greater use of the extended furlough scheme.
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