New PMI report shows economic recovery in the West Midlands being sustained
A NEW survey has provided further evidence of the continued economic recovery in the West Midlands, with new business continuing its strong rise.
The latest Lloyds Bank Commercial Banking West Midlands PMI report shows that the West Midlands private sector economy strengthened further in November.
Incoming new business rose at the fastest pace in the history of the survey, driving a sharper rise in activity. Employment growth was maintained at a marked rate, while backlogs of work increased slightly. Output price inflation accelerated to a two-and-a-half year high, but input costs rose at a slower pace than in October.
Business activity in the private sector rose for a seventh successive month. The rate of growth was strong, having quickened to the fastest rate since March 2012. This was signalled by the Lloyds Bank Commercial Banking West Midlands Business Activity Index – which measures the combined output of the region’s manufacturing and service sectors – posting 59.6, up from 58.3 in October. Anything above 50 indicates growth.
Activity growth was supported by a further increase in new business during November. Growth of new work was the strongest in the survey’s history, with panellists commenting on a general improvement in demand conditions.
Staffing levels at private sector companies in the region increased for an 11th consecutive month. The rate of jobs growth remained marked, despite easing to the slowest since August. Anecdotal evidence suggested that companies hired additional staff to deal with higher workloads and expand capacity.
Outstanding business in private sector companies increased for the fourth month running, however, that said, the latest rise was only marginal and weaker than the UK average.
West Midlands companies also reported another rise in input prices during November, which attributed to higher raw material costs. That said, the rate of input price inflation eased from October’s 18-month high.
Output prices increased at a stronger pace Iast month, with the latest rise the fastest in 30 months.
Andy Youngman, area director SME Banking in Birmingham, Lloyds Bank Commercial Banking, said: “West Midlands companies received a real boost in November, with the strongest growth of new business in the survey’s history. Strong demand boosted firms’ pricing power and enabled them to increase output prices to the greatest extent in two-and-a-half years. Job growth was also maintained at a rate that, although weaker than in the previous two months, remained above the UK average.”