"Firms across the private sector expect activity to fall modestly in the three months to November (weighted balance of -15%), extending a run of negative predictions that began in late 2024, according to the CBI's latest Growth Indicator. The downturn is expected to be broad-based, with business volumes in the services sector set to decline (-15%), driven by weak expectations in business & professional services (-13%) and consumer services (-22%). Distribution sales (-19%) and manufacturing output are also set to contract (-13%)."
"The outlook remains subdued across the private sector, as businesses continue to grapple with sluggish demand, higher employment costs, increasing uncertainty, and squeezed margins. However, expectations for activity are less negative than in the first half of the year, which is a thin silver lining. Even so, there's little evidence yet of a meaningful turnaround, and firms are increasingly focusing on building resilience and efficiency as they navigate a challenging economic environment - at the expense of capital spending and longer-term growth ambitions."
"Firms are already shouldering the cost of the government's fiscal decisions. The Autumn Budget must not add to that strain with further tax rises that risk undermining investment and growth. If the government wants to unlock growth, it must cut the cost of doing business, give firms tax certainty, deliver further flexibility to the Growth and Skills Levy, and rethink the Employment Rights Bill."
Private sector firms expect activity to fall modestly (weighted balance -15%) in the three months to November. The downturn is projected to be broad-based, with services volumes set to decline (-15%), driven by business & professional services (-13%) and consumer services (-22%). Distribution sales are forecast to contract (-19%) and manufacturing output to shrink (-13%). Expectations across most sectors are less weak than in the first half of the year. Private sector activity already fell by a weighted balance of -26% in the three months to August, with all sub-sectors reporting declines. Businesses cite sluggish demand, higher employment costs, rising uncertainty, and squeezed margins.
#private-sector-activity #economic-downturn #services-and-distribution #business-costs-and-investment
Read at London Business News | Londonlovesbusiness.com
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