Lloyds survey points to increase in recruitment by firms in East of England

Steve Elsom of Lloyds Bank Commercial Banking.

Steve Elsom of Lloyds Bank Commercial Banking. - Credit: Archant

Firms in the East of England scaled-up output and hired addition workers during April on the back of a marked increase in new business, according to the new Lloyds Bank Commercial Banking East of England PMI report.

The latest monthly Lloyds Bank East of England Business Activity Index has jumped to 57.4, from 54.8 in March, with the pace of growth in output and job creation beating the average for the UK as a whole.

Both overall business activity, as measured by the index, and new business have now increased for 29 months in a row.

Although weaker than in March, the growth rate remained stronger than the long-run average, with anecdotal evidence pointing to new contract wins and stronger underlying demand.

However, while the volume of new work expanded at service providers, manufacturers signalled broadly unchanged levels.

Payroll numbers in the East of England private sector increased further during April, with the rate of job creation stronger than that seen at the UK level. Manufacturers and service providers both signalled expansion, with companies linking employment growth to rising workloads.

Reflecting higher staffing levels, the level of business outstanding fell during April although the rate of reduction was only marginal. Lower backlogs in the region contrasted with an accumulation seen across the UK as a whole.

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Average cost burdens in the East of England’s private sector increased during April although the rate of inflation was only moderate and below its long-run trend.

Whereas input prices rose in the service economy, manufacturers recorded an overall decrease.

Those companies signalling greater costs reported higher staff salaries as well as increased raw material prices.

Average selling prices rose in April, although only marginally. Higher charges were reported by services companies, while factory gate prices fell. By comparison, the UK as a whole posted an overall drop in prices charged for both services and goods.

Steve Elsom, area director for SME banking for Lloyds Bank Commercial Banking in the East of England, said: “April saw the East of England’s economy move up a gear, with both business activity and employment increasing at faster rates.

“A steep rise in new work combined with improved demand boosted growth, while price pressures remained low.

“The latest data indicates that the region is likely to continue supporting growth at the national level as we enter the second quarter of the year.”