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
- NFL MNF: Pittsburgh Steelers 30, Houston Texans 23 [PHOTOS]
- 2014 MLB World Series Game 1: San Francisco Giants 7, Kansas City Royals 1 [PHOTOS]
- 2014 MLB World Series - Game 2: Kansas City Royals 7, San Francisco Giants 2 [PHOTOS]
- NFL Thursday Recap - Denver Broncos 35, San Diego Chargers 21: Peyton Manning Has 3 TDs In Easy Win [PHOTOS]
Join the Conversation
- Economic Growth In US And Sub-Saharan Africa Allay 2015 Recession Fears
- Travel Alert: Over 200 Canadians Infected with Mosquito-Borne Chikungunya Virus
- Canadian Ebola Drug: Tekmira Firm Starts Limited Manufacturing of Vaccine, Available By December; Shares Up
- US Dedicates 5 Airports for Travellers From Ebola-Stricken Nations, Lawmakers Want Travel Ban
- WHO Races to Release Ebola Serum in 2 Weeks, Vaccines in January
- Xiaomi Redmi 1S vs. Sharp Aquos Crystal – Specifications, Features And Price Showdown
- ASUS Releases A Teaser Indicating The Arrival of New Zenfone and ZenWatch On October 28
- Boy Stoned To Death For Alleged Rape, Victim Receives Dowry From Militants
- Three Dual SIM Samsung Galaxy Note 4 Duos Variants Comes To China
- Russia is Creating Underwater Combat Robots to Protect its Arctic Territories
- ‘Lone Wolf’ Attack on Canada Parliament Hill Could be ISIS-Related
- Android Lollipop 5.0 Confirmed for Nov 3 Rollout as Nexus 6 Global Release Date is Delayed – Reports