Regional firms see best ever August growth

ENGLAND’S regions saw the strongest business growth ever recorded in August, as Lloyds noted robust growth around the UK, and booming firms in some areas.

Purchasing managers from the north west, south east, south west and east of England all reported the strongest growth ever seen, after a raft of recent surveys and figures which suggest that the economy is on the mend.

Overall, Lloyds’ regional purchasing managers’ index (PMI) hit 61, with anything over 50 indicating business growth, the highest score seen since the series began over a decade ago.

The index has now been positive for the past 10 months. Building on a robust performance in July, every region except the north east of England and Yorkshire saw an improvement in its reading in August.

Every part of the UK displayed robust growth, despite fears that the economic recovery is too centred on London. Scotland’s PMI hit a record high, with Wales at the highest point for four years, and Northern Ireland seeing the strongest growth since before the recession hit.

BDO’s latest business trends report told a similar story, with the economic climate for firms reaching a 29-month high, up to 98.3, close to the 100 level that signals the long-term level of economic growth for UK companies. Optimism in manufacturing swelled notably, leaping up from 91.4 in July to 99.6 last month.

However, as in other surveys, BDO found that firms’ intentions to hire are still muted, barely improving in the last five months.

“The sting in the tail is that the improvement is not being reflected in businesses’ hiring intentions,” said Peter Hemington, a BDO partner.

“This is particularly pertinent given the Bank of England Governor Mark Carney’s decision to peg interest rates to unemployment levels”.

But Hemington added: “We’re encouraged to see that business conditions and confidence are continuing to improve.”