NEWS > West Midlands Growth Story
Published: Monday, 29 Nov, 2010
The rate of growth in the region's private sector economy gained momentum in October 2010, according to the latest survey in the West Midlands Purchasing Managers Index, PMI, sponsored by Advantage West Midlands. Activity growth was the fastest it had been for three months, employment returned to growth and nput price inflation continued to moderate.
The rate of growth in the region's private sector economy gained momentum in October 2010, according to a survey in the West Midlands Purchasing Managers Index, PMI, sponsored by Advantage West Midlands. Activity growth was the fastest it had been for three months, employment returned to growth and input price inflation continued to moderate. The headline seasonally adjusted Business Activity Index, which measures the combined output of manufacturing and service sectors in the region, recorded 55.6 in October, up from 54.0 in the previous month. While the latest increase was slightly slower than the average for 2010 so far, activity has now risen continuously since July 2009. Where a rise in output was signalled, this was commonly attributed to further gains in new business.
Intakes of new work received by West Midlands private sector enterprises increased in October. Anecdotal evidence suggested that new business wins were reflective of firmer client demand and, in some cases, the success of promotional activities. Employment also rose in October following a decline in the previous month. Nonetheless, the rate of job creation was only modest. Respondents that reported a rise in workforce numbers often linked it to further gains in new business. October data pointed to a further reduction in outstanding business. However, the rate at which backlogs were depleted was the slowest in four months.
Average input costs rose for the fifteenth successive month in October. Although marked, the rate of inflation was the slowest since September 2009. Prices paid for basic metals, food products and fuel were all reported as having risen since the preceding month. Firms reported passing on higher costs to customers, with output prices rising at a solid and accelerated rate in October. The latest increase was the eleventh in as many months.
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