South England sees record high in growth index

FIRMS are reporting healthy growth across England and Wales, with parts of the south of England reporting the quickest improvement in business activity on record.

Lloyds Bank’s latest purchasing managers’ index (PMI) came in at or above 60 for the fifth month running, suggesting a rapid expansion, well above the country’s long-term trend.

The headline figure reached 61.2 in November, slightly below October’s level but still some distance above the neutral 50 level that separates expansion from contraction.

In the south east and south west of England, where PMI scores reached 63.3 and 62.1 respectively, growth is the strongest since the survey began 12 years ago.

The score in Wales and some English regions fell back slightly from higher levels in recent months, but the survey of 1,200 firms suggests that every part of the country is seeing a sharp improvement in activity.

Though London has often led the index and is still strengthening, this month the capital – which was down to a three-month-low of 62.6, was slightly behind the south east.

“Private sector companies across England and Wales continued their impressive growth performance in November and although activity growth was marginally down on the previous month, most regions continue to grow year-on-year,” said Tim Hinton of Lloyds.

He added: “Firms also reported that new orders were higher than at the start of the year. Companies are now benefiting from stronger domestic spending patterns and increased optimism about the economic outlook.”

As recently as the middle of this year, many firms outside of the south of England were still recording a decline in business conditions, but PMI figures have rapidly strengthened as more robust growth in GDP was recorded during the second quarter.