NW business activity grew in February

Staff numbers were broadly unchanged from one month earlier, while on the pricefront a solid increase in average costs did not to prevent another decline in output charges, according to Lloyds TSB’s Purchase Managers’ Index.

February data signalled a sixth successive monthly expansion of North West private sector output. At 55.0, down from 57.5 in January, the seasonally adjusted index – which tracks the combined output of the region’s manufacturing and service sectors – signalled a marked rate of growth that was again stronger than the UK economy average.

Where an increase in business activity was recorded, companies commented on new business wins, the report said. Service providers reported a stronger rise in output than manufacturers during the month.

Higher new order intakes were recorded for the third month running in February. Companies generally attributed new order growth to better demand from both domestic and external markets. However, the rate of expansion in new work was only modest, and much slower than that recorded in January.

Leigh Taylor, area director for Lloyds TSB Commercial in the North West, said: “February’s survey highlighted another solid expansion of business activity in the region’s private sector economy. This occurred despite a marked slowdown in new order growth, which in turn contributed to a stagnation of job creation.

“Meanwhile, companies’ pricing power remained suppressed by competitive pressures. With input costs rising at a sharper rate in February, this suggests that operating margins at local businesses were again squeezed over the month.”