UK Service Sector Activity Unexpectedly Slumps - CBI
By Shane Croucher | February 25, 2013 7:41 PM EST
Service sector activity slumped below expectations in the three months to February, according to an industry survey, a fresh concern for Chancellor George Osborne over the brittle UK economy.
The Confederation of British Industry (CBI), Britain's biggest business lobbyist, found in its latest quarterly service sector survey that the business and professional firms fell well short of volumes growth expectations, suffering their biggest fall in profitability since November 2011.
Consumer service businesses, such as in the travel and leisure industries, also saw an unexpected sharp decline in activity.
Despite the weakness, optimism remains for the coming three months with anticipations of increasing sales, profits and employment levels anticipated as the UK narrowly avoids a triple-dip recession.
"Economic conditions remain fragile in the service sector," said Anna Leach, CBI's head of economic analysis.
Between January 25 and February 16 the CBI surveyed 147 firms in the powerhouse service sector, which accounts for around three quarters of the UK economy.
Flat growth among service sector businesses weighed heavily on GDP in the final quarter of 2012, as the economy contracted by -0.3 percent.
There were fears over the prospect of an unprecedented triple-dip recession, but mostly improving data in the first quarter of 2013 suggests a third slump with be narrowly avoided.
Fresh concerns over the state of the UK economy have been raised by the loss of the country's AAA credit rating, which was downgraded a notch by Moody's amid a bloating debt pile, missed forecasts, and a continued flatness in output.
However, many in the markets had expected a downgrade for some time and will be largely unconcerned by the rating cut.
To report problems or to leave feedback about this article, e-mail:
To contact the editor, e-mail:
Most Popular Slideshows
- Prince Harry & Camilla Thurlow Getting Serious, St. Tropez Holiday Before The Prince’s 30th Birthday [PHOTOS]
- 2014 US Open: Hottest Male Tennis Players To Watch [PHOTOS]
- What Happens When You Give Up Sex For 12 Months? – Dialogue With Peter Lynagh – Exclusive
- 2014 US Open: Hottest Female Tennis Athletes [PHOTOS]
Join the Conversation
- Ukraine Would Have to Fight Alone – NATO; Port City Near Russia Fears it is Next Target
- West is ‘Really Weak’ vs Russia, Says Ukrainian Diplomat; Crisis Has Displaced Over 1M People
- Ukraine Crisis: Russia vs US, EU…. And the Winner is Actually China
- New Magaluf Sex Scandal: 15 Men Lick Cream Off British Teen’s Naked Breasts
- Growing Number of Canadian Workers Opt to Receive Bitcoin Salaries
- 5.5-Inch iPhone 6 is iPhone Air on Sept 19 Release Date: 5 Things to Consider Before Buying
- Nexus 6 Release Date Update: Moto X+1 Look Leaked, Nexus X or Shamu Moved to Demo Phase
- HTC One M8 for Windows Vs. Nokia Lumia Icon, The Battle Of Windows Phones
- Leaker of Actresses Nude Photos Accepting PayPal Donations in Exchange For Posting Alleged Sex Video of Jennifer Lawrence, Has Naked Pictures of 100 Hollywood A-Listers
- ISIS Will Target the U.S. Power Grid, Former CIA Says; Could Tap Other Fellow Extremist Groups to Do the Job
- Jennifer Lawrence's Nude Photos Leaked on Find My iPhone, Apple 'Outraged' But Says Systems 'Not Breached'
- Russia Massacres Ukrainian Volunteer Battalions—Surviving Members Alleged