South west businesses continued to recover from the shock of the EU Referendum, recording higher order books and creating new jobs in September, according to the latest Lloyds Bank Regional PMI.
The South West PMI registered 54.5, down slightly from August’s recording of 55.5 but still showing a quicker pace of growth than the UK average. A PMI reading above 50 signifies growth in business activity.
Data for September revealed that private sector firms continued to create jobs for the third month in a row as new business increased, albeit at a slower pace than the previous month.
Cost pressures also continued to intensify as firms experienced a rise in average input prices – which includes rent, materials and staff salaries – leading south west businesses to increase prices charged for their goods and services in September.
The Lloyds Bank Regional PMI, or purchasing managers’ index, is the leading economic health-check of UK regions. It is based on responses from manufacturers and services businesses about the volume of goods and services produced during September compared with a month earlier.
David Beaumont, regional director for SME banking in the south west, Lloyds Bank Commercial Banking, said: “The south west continued to rebound from July’s referendum-induced shock in September, and to a greater extent than the UK as a whole.
“Moreover, PMI data signalled a faster rate of growth over the third quarter than in both Q1 and Q2 of this year. Among the 12 UK regions covered, only Wales outperformed the south west over the last three months.
“That said, growth eased slightly in September compared with August, and a slower rise in new business points to a softening in growth momentum towards the end of the year.”