LONDON: Britain's private sector business activity is slowing sharply on the back of shortages of staff and raw materials, a key survey showed on Friday.
The composite purchasing managers' index (PMI) slowed to a four-month low of 57.7 points in July, compilers IHS Markit and the Chartered Institute of Procurement and Supply said in a statement.
The reading compared with a reading of 62.2 in June, but held above the key 50 level to indicate expansion.
"The speed of recovery was the weakest since March, with survey respondents widely reporting staff and raw material shortages due to the pandemic," the statement said. "Concerns about the loss of momentum contributed to the lowest degree of optimism towards the business outlook for nine months."
Many firms face cost pressures and supply challenges, despite recovering economic growth and resurgent demand after England fully emerged from lockdown this month.
Businesses suffer from runaway costs as a result of shortages of raw materials, which in turn fuels inflationary pressures.
Sentiment also remains blighted by spiking UK infections of the fast-spreading Delta variant of coronavirus.
Business leaders have urged the UK government to re-think its Covid isolation policy - which has sparked millions of staff absences across the country.
Soaring infection rates had also "cast a darkening shadow over the outlook", he noted.
Millions of workers are currently forced to stay at home under the so-called "pingdemic" after being contacted, or pinged, by a phone app which orders them to self-isolate, or by health authorities conducting contact tracing. The Confederation of British Industry (CBI) had warned Thursday that the manufacturing outlook was clouded by soaring costs and self-isolating staff.
Comments
Comments are closed.