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By David Robinson
LONDON (MNI) - The latest Bank of England Agents Report highlighted the
softness in the UK consumer services, with both recruitment and growth in the
The updated May Agents Report painted a picture of subdued overall growth,
with companies facing hiring difficulties and the consumer sector hardest hit.
"Recruitment difficulties had broadened across skills and sectors, which
was reported to be partly due to reduced availability of EU migrant workers.
Employment intentions had ticked up in manufacturing but remained weak in
consumer services, due to higher labour costs and weak sales," the agents report
Investment intentions overall were reported to be modest, with business
services and manufacturing sector firms planning to raise investment but
consumer services firms investment plans again weak.
Labour cost growth nudged higher, reflecting a mix of slightly higher pay
settlements and rising non-wage costs as a result of the rollout of pensions
auto-enrolment. The agents say pay awards were typically in a 2.5% to 3.5%
Pressure on headline inflation has eased due to the waning effects of past
sterling depreciation, although agents said this was being offset by rising
global commodity prices.
The agents scores showed investment intentions for manufacturing in April
holding steady at 1.5 while in services the score fell to 0.9 from 1.0 in
Total labour costs per employee were unchanged at 2.1 for manufacturing in
April and rose to 2.3 for services from 2.1 in April against February. Services
business intentions fell to 0.3 from 0.4 but rose to 0.7 from 0.6 in
The Agents Report is based on the Bank's regional agents collecting
responses from local business and compiling them into a rolling survey which is
available for policymakers and is published once a month, with scores reflecting
net rises and falls in the various categories.
--MNI London Bureau; tel: +44 203-586-2223; email: email@example.com