![Rise in business confidence revealed in North West PMI survey](https://i0.wp.com/marketingstockport.co.uk/wp-content/uploads/2020/07/Rise-in-business-confidence-revealed-in-North-West-PMI-survey.jpg?resize=780%2C400&ssl=1)
Listen to this article here
|
Business activity continued to rise at a solid pace across the North West during May, according to the findings of Natwest’s Regional PMI business survey.
The continued rise in activity coincided with stronger confidence towards firms’ outlook for the year ahead, which in turn contributed to a pick-up in employment growth. Cost pressures meanwhile subsided somewhat, after having spiked in April with the change to the National Minimum Wage.
The headline North West PMI Business Activity Index – a seasonally adjusted index that measures the month-on-month change in the combined output of the region’s manufacturing and service sectors – registered at 53.4, ahead of the UK average.
A fifth consecutive monthly increase in new business across the North West in May pointed to a sustained improvement in underlying demand facing the region’s businesses. The rate of new order growth was strong and the second-fastest among the 12 nations and regions monitored by the survey. The upturn was supported by a sustained and sharp rise in the services sector, which was accompanied by a fresh expansion in manufacturing new orders. Firms cited more confidence among clients and successful marketing campaigns.
Following a spike in costs in April, which was linked to changes in the National Minimum Wage (both its level and coverage), the rate of input price inflation faced by firms in the North West eased sharply to a six-month low in May. It was also one of the slowest among the 12 monitored nations and regions. Where a rise in operating costs was recorded, firms cited higher prices paid for a range of materials, including copper, alongside wage demands.
Malcolm Buchanan, Chair of NatWest North Regional Board, commented:
“May’s PMI survey makes for encouraging reading. Growth is becoming more entrenched across the North West private sector, as we see business activity rising for the fifth month running on the back improving underlying demand. Companies are looking to the future with optimism, and this positive mood, alongside greater workloads, has translated into a solid rise in employment in May. There was also some relief for local firms on the cost front, with April’s spike in input prices followed up by a much more moderate increase in May.”