Figures out today from the Chartered Institute of Purchase and Supply and Markit show that the UK’s service sector – where the majority of UK freelancers and contractors ply their trade – is growing at the fastest rate for 17 years. This expansion is being driven by more availability of work from other areas of the economy, which is in turn driving more employment and company expansion. Staff are now being taken on at the same rate as in May 1997.
Increased staffing levels and higher wages are also driving up operating costs for service sector companies. Confidence about future growth remains high, with over half of companies surveyed for the report expecting further expansion in the next year.
Chris Williamson, Chief Economist at Markit, which compiles the survey, said:
“The UK economy continued to boom in May, in what is the best spell of growth since 2007. The buoyant services PMI follows similar upbeat manufacturing and construction reports, which collectively suggest that the economy is on course to grow by 0.8% again in the second quarter. That would push the economy above its pre-crisis peak.
“The really great news is that job creation continued to run at the record pace seen in April, meaning unemployment looks set to fall further.”
The services sector encompasses those in the communications, financial, technology and hospitality industries. A similar report last week highlighted the improved employment prospects for the UK’s contractor workforce. Taken together with other indicators, it seems clear the UK’s economy is rebounding from several years of lacklustre performance.
Photo by Oinonio