Private firms' expectations for business activity in the East of England in 2021 improved further in December whilst the job-shedding seen over the previous nine months came to an end, according to a key survey of purchasing managers.
The NatWest East of England future outlook index climbed for the second straight month – up from 69.3 in November to 71.5 – and the highest since August. Vaccine rollouts, business expansions and new product launches fuelled the optimism. Meanwhile, private firms in the East increased staffing in December. Although slight, the increase was in contrast to the marked contractions seen in previous months.
Overall, the headline NatWest East of England business activity index fell from 51.2 in November to 50.1 in December, pointing to unchanged activity, although the backlog of incomplete work at firms in the region rose. The survey also pointed to a modest improvement in export markets. But it also signalled a ‘substantial increase’ in cost pressures faced by private firms in the region, particularly manufacturers.
John Maude, NatWest Midlands & East regional board, said: “December data highlighted a sombre end to 2020, with output broadly stagnating in the East of England. The continuation of virus-related restrictions weighed on business activity, growth of which ground to a halt. There were some positives however, with demand conditions improving following new client wins, whilst vaccine rollouts and business expansion plans fuelled greater optimism surrounding output in 2021.”
