There is reason for optimism for businesses in Whitecap’s home city of Leeds and the surrounding region with the news that the service sector in the UK grew healthily to an 8 month high in July.
The Markit/CIPS services purchasing managers’ index (PMI) indicates expansion when it passes 50. In July it reached 59.1, up 2.4% on the previous month. It’s the fastest growth the Index has recorded since November 2013.
Services now represent over 70% of the UK economy and have been a major factor in driving economic recovery. In Leeds, the service sector has long dominated the landscape, with financial and professional services, retail, technology and a thriving digital economy amongst the sectors underpinning the city’s growth. Businesses across all these service sectors and beyond will all be enthused to see the nation reporting strong growth and a positive outlook.
It’s certainly a trend that we can relate to in our work as strategy consultants to service sector businesses in the region. The CEOs and business leaders we speak to are bullish about their prospects for the rest of 2014, and are setting their sights on an even more successful 2015.
Encouragingly, there’s also very firm evidence to back up their growth stories, and nowhere is this more apparent than in their recruitment efforts. One of the most significant challenges facing these businesses today is recruiting the right quality talent to fill the new vacancies they have recently created. The jobs market in the region is currently in excellent health.
There’s also undoubtedly been a major feel-good factor in the city this year on the back of major developments such as First Direct Arena, Trinity, and more recently the Victoria Gate development and overhaul of the New Dock. There’s already an impressive roll-call of well known brands based in the city of course, including the likes of Asda, Jet2.com, and First Direct, to name but three.
Moving forward, it appears we are set for further strong economic growth in the current trading quarter, with GDP forecast to hit 0.8%. The UK economy has grown by 0.8% in both the first and second quarters of this year. Whilst that may point towards further pressure on an interest rate rise, the positive trading conditions should ensure the rest of 2014 is strong period for service sector in Leeds and beyond.