A new report shows that demand grew for more UK sectors compared to the previous month.
With figures showing a slower summer compared to recent years, this news has been very much welcomed.
Results show a mixed bag
The Lloyds UK Sector Tracker reveals that August saw the number of sectors reporting demand growth rise to four – up from one in July.
Measured by new order volumes, the sectors to see this demand include:
- Software and services (63.8)
- Financial service (57.1)
- Technology equipment manufacturing (52.5)
- Automobile and auto parts manufacturing (51.3)
This is the highest number of sectors to report demand growth in nine months.
However, the report also shows this was the twelfth successive month where demand softened in more than half of the 14 UK sectors that are tracked.
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Businesses’ costs continue to rise
According to Nikesh Sawjani, Senior UK Economist at Lloyds, while the report shows a broadening of demand growth across the UK economy, businesses’ costs continue to rise.
Currently, these costs are not being felt by customers as businesses are taking the brunt themselves, but this might not be a realistic strategy for the long term. There’s only so long that businesses can do this.
Should costs continue to accelerate, there’s a chance that organisations will need to rethink and change their strategy.
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