Agents' Summary of Business Conditions - April 2008

We regularly publish a summary of reports compiled by our twelve regional Agents following discussions with at least 700 businesses across the UK every reporting period.

Published on 21 April 2008

Consumption growth eased further, driven by slower growth in discretionary spending.
Housing demand remained weak.
Investment intentions fell sharply again in the services sector, and eased across most industries and regions. Tighter credit conditions continued to weigh on investment plans, mainly through their effect on uncertainty about demand.
Demand for exports remained at a high level, though growth of export orders had eased slightly.
Growth in manufacturing output remained firm while that in construction and services sector output slowed further. (An Agents’ survey examined the gap between actual and expected outcomes.)
Labour demand softened, with a marked fall in employment intentions in the services sector. The inflow of migrant labour had slowed and recruitment difficulties eased.
Capacity pressures were expected to ease significantly over the coming six months.
Growth in total labour costs remained well contained, though there were some reports of modest upward pressure on settlements in response to increases in the cost of living.
Annual input price inflation rose sharply and annual output price inflation increased as manufacturers sought to restore margins.
Annual consumer price inflation increased, driven by higher prices of both goods and services.