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Firms recruiting staff despite rising cost pressures

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Private sector firms in the East of England increased staffing levels in February on expectations of higher output and demand over the coming months but faced marked rises in costs, according to a key survey of purchasing managers.

The NatWest East of England business activity index showed pointed to a marked increase in input price inflation and the sharpest since June 2018. Both service providers and manufacturers saw a rise in cost burdens, although the latter noted a much sharper uptick. The survey showed private business activity stabilised in February and firms in the region remained confident about growing output over the next 12 months; the  degree of optimism climbed to its strongest in almost five years. The  index rose from 43.5 in January to 49.0 in February.

John Maude, NatWest Midlands & East Regional Board, said: "Private sector activity in the East of England declined again in February with Covid-19 lockdown restrictions persisting during the month. That said, the latest fall was only marginal with rates of reduction in business activity and new orders easing notably from those seen in January. The real cause for concern comes from sharper price pressures faced by companies. Transportation bottlenecks, higher freight costs, and material shortages all helped accelerate the rate of input price inflation, which was robust and at a 32-month high."

Last Updated ( Monday, 08 March 2021 10:38 )