Service sector profitability up

Firms in the services sector were more profitable in the third quarter of 2011 than at any time since late 2008, according to figures out yesterday from the Office for National Statistics (ONS). However, manufacturing firms’ profitability fell to its lowest since records began in 1997. The rate of return for non-financial services firms hit 15.9 per cent, up from 15 per cent in the previous quarter and compared with 16.1 per cent in 2008. Manufacturers recorded profitability of five per cent in the third quarter, down from six per cent in the previous three months. Firms finding and producing oil and gas on the UK continental shelf were the most profitable, with a net rate of return of 60.5 per cent. Separate ONS figures showed yesterday that labour productivity rose 0.2 per cent on an hourly basis in the third quarter.