Services sectors sees positive start to 2012 - Source = www.Recruiter.co.uk 3rd February 2012.

The UK services sector saw the largest one-month gain in business confidence since the Markit/CIPS UK Services Purchasing Managers Index (PMI) started in 1996, up nearly seven points to 70.3 in January’s data.

Employment leaped by 2.1 points to 52.2, where scores over 50 indicate an increase in the levels of employment month-on-month, with the survey having been in sub-50 territory, with such scores indicating receding employment, for seven of the 12 months of 2012.

Business activity rose by two points to 56, a level not seen since March 2011, and prior to this not since March of the previous year.

David Noble, chief executive at the Chartered Institute of Purchasing & Supply (CIPS): “Compared to the volatility seen through most of last year, sustained and accelerated growth in the service sector is welcome news. A record improvement in the degree of optimism and the highest increase of employment in nearly four years represents a tentative vote of confidence for the year ahead.”

“Lower energy bills and overall weaker input cost inflation are also helping to ease the squeeze on margins and improve profitability across the sector as a whole.”

Chris Williamson, chief economist at survey compilers Markit: “The surprisingly strong upturn in the service sector follows a similar improvement in manufacturing and ongoing growth in construction, which all points to a resounding revival of UK economic growth in January.

“As to how sustainable this upturn is, it is particularly encouraging to see the upturn in business confidence. Much uncertainty persists, but this is nevertheless a far better start to 2012 than almost all were expecting to see.”