Monday 20th September 2021
Home General Business News Optimistic firms continue to recruit despite slowdown in growth

Optimistic firms continue to recruit despite slowdown in growth

E-mail Print PDF

The pace of recovery in business activity in the region slowed in August but private firms are continuing to recruit strongly and remain optimistic whilst the recent upturn in inflation has eased, according to a key survey of purchasing managers.

The NatWest East of England PMI business activity index fell from 60.0 in July to 54.5 in August, although growth was still strong by historic standards. New business won by private firms slowed but remained healthy with service providers seeing a quicker increase in new orders than firms producing goods. A future activity index moderated in August but stayed above 50, signalling a high level of optimism among firms in the East. Firms are hopeful for strong domestic demand and as supply chain pressures ease.

Meanwhile, the rate of growth in staffing levels quickened in August, rising for the eighth time in nine months on hopes for higher sales and on the need to clear backlogs of work. After increasing in each of the past six months, the rate of cost inflation slowed in August to the softest since May. But higher transport, staff and raw material costs (especially for steel and cardboard) are still driving inflation and charges by firms rose sharply, particularly amongst manufacturers. John Maude, NatWest Midlands & East regional board, said: "…firms continue to add to their workforces in order to boost output, while price pressures have started to moderate. At the same time, local firms remain strongly optimistic about the outlook, hoping that supply pressures will ease and any future lockdowns can be avoided."