North West business activity climbs to six-month high

BUSINESS activity in the North West climbed to a six-month high in March as the recovery from the Covid pandemic gathered pace, NatWest’s latest PMI survey has revealed.

The banking giant’s latest monthly report for the region showed higher demand and growing optimism towards the outlook in turn leading to a rise in employment for the first time in over a year.

The data monitors the monthly change in the output of goods and services across the private sector, with any reading above 50 signalling growth.

The North West registered a reading of 56.5 in March, up from 50.3 in February - showing output levels rising at a “solid and accelerated rate”, and one that was the quickest since September last year.

Businesses reported a rise in inflows of new work for the first time in four months, and the rate of growth was the quickest seen in over three years.

Output price inflation accelerated at its quickest rate since May 2011

Richard Topliss, chairman of NatWest North regional board, said: “We saw the first clear indications of a start of a recovery in business activity across the North West private sector in March, as the first phase of the easing lockdown restrictions led to increased optimism and demand in the market.

“It was encouraging to see the tide having turned on the labour market front as well, with job creation returning for the first time since before the pandemic.”

There was a continued improvement in firms’ expectations for activity over the next 12 months, the PMI said, with the degree optimism reaching the highest in over four years.

Anecdotal evidence in the report pointed to increased hope among local businesses of an end to lockdown restrictions on activity at home and abroad over the coming year.

As well as that, the prolonged sequence of job losses that began in February 2020 came to an end, and the decline in outstanding business slowed.

Mr Topliss added: “The positive results for activity and employment are tempered somewhat, however, by the findings that cost pressures facing local businesses have continued to intensify.

“Latest data showed firms’ input prices rising at the fastest rate in more than four years, driven largely by surges in raw material and transport costs.

“Still, this has done little to dent business confidence, which continues to improve as more and more firms see an eventual end to Covid-19 restrictions at home and abroad in the months ahead.”