- Final services PMI 51.1 vs 51.4 expected and 50.8 previously.
- Final PMI Composite 50.4 vs expected 50.5 and previous 50.5.
Main results:
- Earnings decline for the third month in a row.
- A slight increase in business activity.
- Input cost inflation accelerates to an eight-month high.
Opinion:
Tim Moore, Director of Economics at S&P Global Market Intelligence, said:
“The service sector ended last year with only a modest increase in business activity and virtually no new jobs coming in. Survey respondents suggested that a decline in business and consumer confidence, largely due to concerns about domestic economic prospects in 2025, had led to a significant loss of growth momentum. part of the UK service economy given weak demand and cuts to client budgets, there were still pockets of strong growth in areas such as technology services.
A post-Budget decline in business optimism continued in December, with expectations for output growth for the year ahead unchanged from November's 23-month low. Concerns about the impact of rising payroll costs, along with general unhappiness about the climate for business investment, were reported to be the main factors responsible for growth prospects in 2025.
Rising input price inflation added to the bleak long-term outlook for service providers, with overall cost pressures reaching an eight-month high in December. At the same time inflation-dependent prices rose at the end of last year and remained well above pre-pandemic trends.
Suffering from low demand conditions and rising employment costs, many service providers chose to restrict their staff recruitment and delay the replenishment of positions in December. Nearly one in four survey respondents saw an overall decline in their payroll numbers. Without the pandemic, this would have been the fastest pace of job shedding for more than 15 years. “
UK Composite PMI
