S&P Global UK Services PMI survey data indicated that the sector eked out another slight rise in output levels. New orders and staffing numbers nonetheless fell at faster rates than at the start of 2025.
The latest reduction in employment was the sharpest since November 2020, which was linked to weak demand and sharply increasing input prices. Overall cost inflation eased since January but remained much faster than seen throughout the second half of last year.
At 51.0 in February, the headline seasonally adjusted S&P Global UK Services PMI Business Activity Index was up fractionally from 50.8 in January and above the neutral 50.0 threshold for the sixteenth successive month.
However, the latest reading was well below the long-run series average (54.3) and pointed to only a marginal expansion in service sector output.
The seasonally adjusted S&P Global UK PMI Composite Output Index registered 50.5 in February, down from 50.6 in January but above the 50.0 no-change value for the sixteenth successive month.
Higher levels of service sector activity more than offset a solid reduction in manufacturing production.
New business volumes meanwhile decreased for the third month in a row, reflecting subdued demand in both the manufacturing and service sectors.
Lower sales volumes and sharply rising input costs, especially staff wages, contributed to another fall in private sector employment. The latest decline was the fastest since November 2020.