Insight 43 - Magazine - Page 29
Private sector expects steep
decline in activity into 2025
P
rivate sector firms expect activity
to fall in the three months to
March (weighted balance of -24%),
according to the latest Growth Indicator.
Expectations are now at their weakest in
over two years.
This pessimism was shared across all subsectors. Business volumes in the services
sector are anticipated to decline (-18%),
driven by predicted falls in both business
and professional services (-13%) and
consumer services (-37%). Distribution
sales are expected to fall steeply (-35%),
and manufacturers also anticipate output
to fall (-31%), with expectations at their
weakest since May 2020.
The disappointing outlook comes as
private sector activity fell again in the
three months to December, at a faster pace
than in the three months to November
(-21% from -13% in November). Activity
has been flat or falling since August 2022.
"Private sector activity
fell again in the three
months to December,
at a faster pace than in
the three months to
November"
Key findings from the CBI monthly
Services Sector Survey showed:
• Business volumes in the services sector
fell in the three months to December
(-18%), with the pace of the decline
accelerating from November, with
volumes having generally been flat or
falling since mid-2022.
• Within this, business & professional
services volumes fell (-14%), building
on the marginal decline in the three
months to November. Consumer services
volumes also fell sharply (-35%), at a
broadly similar pace to November.
• Hiring intentions within the services
sector are weak. Business & professional
services expect headcount to fall over
the next three months (-17%), with
expectations at their weakest since
September 2020. Consumer services
companies also anticipate numbers
employed to fall sharply (-49%).
• Price growth expectations have
accelerated from November (+20%)
and stand above the long-run average
(+7%). Inflation expectations for
business & professional services ticked
up in December (+13%, from +7% in
November), and accelerated more
prominently for consumer services firms,
to their strongest in a year (+42%, from
+21%).
biz4Biz.org
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