The UK’s financial restoration stumbled in August as labour shortages dampened greater than six months of unrestrained development.
The IHS Markit/CIPS Flash UK Composite PMI – an early indicator of financial well being – gave a studying of 55.3 for August, down from final month’s 59.2.
Scores over 50 on the index signify development – numbers below 50 signify an financial contraction.
The studying of 55.3 for the month was worse than the Reuters ballot of economists previous to the discharge of the outcomes. Reuters had forecast 58.4 for August.
The slowdown has been prompted by provide chain points and job shortages which stem from each Brexit and the pandemic.
“The variety of firms reporting that output had fallen attributable to employees or supplies shortages has risen far above something ever seen beforehand in additional than 20 years of survey historical past,” mentioned Chris Williamson, chief enterprise economist at IHS Markit.
In the meantime, inflationary pressures confirmed indicators of relenting in August, with enter costs rising on the weakest tempo for 3 months.
Nonetheless, many companies commented on larger wages attributable to tight labour market situations, IHS Markit/CIPS mentioned.
Extreme shortages of uncooked supplies and demanding elements additionally continued to push up buying costs, with UK items producers signalling the sharpest total downturn in provider efficiency since April 2020, they added.
“An abnormally massive slowdown in total exercise in August affords a stark warning to the UK economic system that the accelerated ranges of development we have seen earlier this summer time usually are not sustainable,” mentioned Duncan Brock, group director at CIPS, one of many organisers of the survey.