While the economy is moving slower than predicted, certain sectors seem to be taking advantage of the lower inflation and accelerated wage growth. When snowfalls smothered the British landscape earlier in the year, the service sector was hit with low customer turnout and difficulties with receiving and sending deliveries. The sector seems to have finally recovered its stride, with a new survey reporting record-high growth for business and professional service companies in particular.
A new survey from the Confederation of British Industry (CBI) has found that profits, sales volumes and general business optimism, all grew significantly within professional services during the first quarter of 2018. This is the sharpest rate of growth since August 2015, and shows positive signs of what the post-Brexit landscape could look like.
Despite the initial post-Brexit outlook of doom and gloom, the reality is expected to be much brighter. As opposed to the devasting job losses that were expected, employment remains strong and the positive performance from service and construction sectors highlight the possibility for a bright economic future.
At the Credit Protection Association, we encourage financial scrutiny whether the business is experiencing a boom or gloom. Preparing cash flow for both upturns and downturns are essential, ensuring credit ratings are strong and late payers are absent.
The CBI survey is known often to diverge from official figures, as official data measures recorded changes in output and orders, whereas the business lobby relies on what companies tell it.
The survey asks businesses to state whether conditions were better, worse or the same on a variety of subjects, before taking a net position for responses. Such a system means that if a number of companies say that things are better than last month, even if only slightly, this can turn into a large upward swing on the survey.