Services Index Increase Of 2.7% In February

All four of the main components of the index of services increased in February 2014 and it resulted in an increase of 2.7% in the total index in February.

The largest effects came from business services and finance with an increase of 1.4% to the total and distribution, hotels and restaurants which contributed 0.7% to total growth. The transport, storage and communication sector added and increase of 0.09% and government and other services 0.44%.

The monthly comparison of figures in the index of services shows that output in services increased by 0.2% between January and February 2014.

Business Services Leading Growth In Sector

The ONS index of services grew by 3.2% (IOS=106.6) over the year to January with all of the main service sectors showing growth. Business services and finance contributed the most with an increase of 3.5% and 1.4% to total growth in the service sector with administrative and support services contributing 11.3 %, distribution, hotels and restaurants also contributed growth of 1%, government and other services grew 1.7% and 0.5% to total growth and transport, storage and communication grew by 2.5% and 0.3% to total growth.

The month on month estimates show that there was growth of 0.4% in output between December 2013 and January 2014. Quarterly figures show growth of 0.8% between Q4 2013 and Q3 2013.

Slight Increase In Services Output

The seasonally adjusted index of services published by the ONS is estimated to have increased by 0.6% in December 2012 compared with December 2011. Three of the four service sector index components increased during the period, most recent month compared with the same month a year ago. The services sector index number for December was 103.7. The index of services has not follwed the line of the double dip recession but has enjoyed a long period of growth and is above its pre-recession peak. The weakness in the economy is coming from other sectors.

The most resilient of the components making up the service sector index has been government and other services. It is now above its pre-recession peak after a period of decline. Not all components have fared so well. Business services and finance are slightly below the pre-recession peak as are distribution, hotels and restaurants and transport, storage and communication. It is to be expected that government services would do well during a recession as services relating to unemployment, careers and skills are in greater demand as automatic fiscal stabilisers come into effect.

The largest contributions to the overall increase came from distribution, hotels and restaurants with a 2% increase and government and other services which increased by 1%. Transport storage and communication increased by 0.5% but business services and finance decreased by 0.3%.

Looking at the quarterly comparison, between Q3 and Q4 services output decreased by 0.1%. The estimate from the GDP preliminary estimate for Q4 of no difference was slightly up on the actual figure. The estimate published is consistent with the second estimate of GDP. When comparing this quarter with the same three months in 2011 output increased 1.2%. The main contributors to the decrease came from government and other services with a decrease of 0.8% and distribution hotels and restaurants with a decrease of 0.5%. Upward pressure came from transport, storage and communication with an increase of 1.2% and business services and finance with an increase of 0.2%. The third quarter figures were helped by the Olympics and Paralympics.

The monthly comparison for December shows that service sector output decreased by 0.4% between November and December 2012 but increased by 0.6% when compared with December 2011. Transport, storage and communication increased by 0.5% during the month but the other three components decreased including a fall of 0.8% in business services and finance.

Services Output Up 2%

The index of services for October 2012 compared with October 2011 was estimated to have increased by 2% according to a statistical bulletin from the ONS. All 4 components increased output: business services and finance by 2.8%, government and other services by 1.8%, transport, storage and communication by 2% and distribution, hotels and restaurants by 0.6%.

On the monthly comparison service sector output was said to have increased by 0.1% between September and October 2012. Business services and finance and transport, storage and communication both grew over the month by 0.8% and 1.1% respectively. Government and other services and distribution, hotels and restaurants both decreased by 0.5% and 1.3% respectively offsetting the increases.

Services Index Increases Again

The index of services (seasonally adjusted) increased by 0.7% in July 2012 compared with July 2011. There were increases in three of the four services index components - distribution, hotels and restaurants, transport, staorage and communication, business services and finance and government and other services. The largest contributors to the increase were government and other services with an increase of 1.6% and business services and finance with an increase of 0.8%.

Business Sevices Lead Services Growth

Business services and finance were the largest contributor to the 1.3% increase in the Index of Services in May 2012 with an increase of 1.7% according to a bulletin from the ONS. The other major contributor to the increase in the index was government and other services with an increase of 1.5%. Three of the four service sector components of the index increased in May compared with last May.

Within the business services sector the main contributor to the increase came from other professional services which increased by 5.8% and administrative and support services which increased by 5.2%. Human health and social work activities were the main contributor to the increase in the government and other services sector.

Transport, storage and communication was the sector component that showed a decrease of 0.5%. Distribution, hotels and restaurants, the other component, increased by 1.4%.

Services Growth 0.8%

The index of services for February 2012 from the ONS increased by 0.8% compared with February 2011. The largest contributions to the increase of the three sectors that increased were from business services and finance and government and other services both of which grew by 1.1%. On the monthly analysis the sector fell by 0.4%. The increase in business services and finance came mainly from professional services activities with an increase of 5.1% and administrative and support activities with 4% growth. Government and other services increase came mainly from increases in human health and social work activities which increased by 2.3%. The only one of the four major components of the index to see a decrease was distribution, hotels and restaurants which fell by 0.2%.

Service Sector Increases Growth

The index of services published by the ONS shows that the services sector grew by 2.4% in December 2011 compared with December 2010. All components of the service sector index reported growth. The biggest contributors to the increase were business services and finance which grew by 2.9% and government and other services which grew by 2.3%. The sector also increased on the monthly comparison by 0.2%.

The main contributors of the five components of the business services and finance section were other professional services and real estate. All five components showed an increase. Output increased in five of the six components of the government and other services category with human health and social work activities providing the main contribution with an increase of 3.1%

The public strike on the 30 November probably has an effect on the index but it is difficult to measure the effect directly.

Service Sector Growth In October

The services index published by the ONS showed that the sector grew by 1.1% in October 2011 compared with 2010. The sector output decreased between September and October 2011 by 0.7%. Three of the four main components of the index grew with government services increasing by 2.3%. Business services and finance increased by 1.5% compared with October 2010.

Business Services Drive Up Services Index

The index of services (seasonally adjusted) increased by 1.2% in September 2011 compared with a year earlier. Business services and finance increased by 1.5% ands accounted for 38% of services, government and other services increased by 1.6% and accounted for 29%, distribution, hotels and restaurants which accounts for 18% remained unchanged and transport, storage and communication increased by 1.5% and accounted for the other 15% of services.

Services Output Increased 1.6% Over the Year

The index of services published by the ONS increased by 1.6% in June 2011 compared with June 2010. There was an increase in all components.

The largest contribution was made by business services and finance which rose by 1.6%, its highest increase since October 2010. Hotels and restaurants increased by 3.6%, the highest since February 2008, transport, storage and communication by 3.4% and government and other services by 1.2%.

Output in the services sector fell by 0.1% over the month between May and June 2011. While output grew in hotels and restaurants by 2% and government and other services by 0.2%, it remained as it was in business services and finance and fell by 1.6% in transport, storage and other services and by 0.7% in distribution.

Business And Finance Lead Services Growth In February

The seasonally adjusted index of services from the ONS increased by 1.5% in February 2011 compared with February 2010. All of the five components of the index recorded an increase but the largest increase was in business services and finance with an increase of 1.5%. The largest contribution to the increase was from computer services with 7.1% which contributed 1.5 percentage points to the 1.5% increase.

Looking at the most recent month on a year earlier distribution increased by 1.6% with wholesale contributing 3.7%. Transport, storage and communication increased by 2.7% with post and telecommunications contributing a 7.7% increase or 3 percentage points to the 2.7% increase. Government and other services increased by 1.2%. Health and social care made the largest contribution with an increase of 4.3% or 1.4% to the increase. Hotels and restaurants increased by 0.5%.

Services Growth In October

The index of services for October 2010 published recently by the ONS shows that the service industries grew by 1.9% on October 2009. The main contributor to the increase was the business and services component's increase of 2.6%. Within the business component the largest contributions came from the 5.2% increase in computer services and the 3.8% increase in real estate activities.

Four of the five components showed an increase and hotels and restaurants also increased by 2.6%. Distribution services and Government services both increased by 1.7%. Transport, storage and communication remained unchanged in October.

The index for the last three months was up 2.3% on a year earlier and 0.6% up on the last three months but down 0.4% on September 2010.

Services Index Up by 1.4%

The ONS Index of Services increased by 1.4% in June 2010 compared with June 2009. Four of the five components increased over the year. Distribution increased by 4.2%, business services and finance by 1.7%, hotels and restaurants by 0.9% and government and other services by 0.7%. The only component to show a decrease was transport, storage and communication with -1.7%. It was a very similar picture over the quarter the only difference being hotels and restaurants which remained unchanged.

Services Increase Output By 1%

The ONS Index of Services rose by 1% in April 2010 compared with April 2009. All five components saw an increase in output in the most recent month on a year earlier. Distribution made the largest contribution with an increase of 4.6%.

The motor trades made the largest contribution within distribution with an increase of 10.3%. Retail also made a significant constribution with an increase of 3.4%. Hotels and restaurants increased by 0.4% with the biggest increase coming from restaurants. Transport, storage and communication increased output by 0.2% with transport services making the most difference with an increase in output of 4.7%. Business services and finance increased its output by 0.4% in April 2010 compared with April 2009. Real estate made the biggest contribution with an increase in output of 2.6% which added 0.8 percentage points to the 0.4% increase. Government and other services increased their output by 0.5% and the largest contribution came from health and social care which increased by 3.1% adding 1 percentage point to the 0.5% increase on last year.

UK Officially Out Of Recession

The latest GDP preliminary estimates show that Britain is officially out of recession. According to the ONS, GDP increased by 0.1% in the fourth qaurter of 2009. The index increased from 100.6 to 100.7 (100=2005). It means the recession is over, recovery has begun and if it can be maintained we can look towards growth. The increase is mainly due to the distribution, hotels and restaurants category with an increase of 0.4% and govermnent services with an increase of 0.2%. Output in both the production and the service industries increased by 0.1%. Between Q4 2008 and Q4 2009 GDP decreased by 3.2%.

These preliminary GDP estimates may be revised upward or downward during the next few weeks until the end of February when the Output, Input and Expenditure (OIE) estimates are published. The full set will be published in the Quarterly National Accounts in April.