U.K. Services Shrink Most on Record After Virus Lockdowns
The fallout from the disease is being felt the world over as economic activity comes to a standstill.
(Bloomberg) -- U.K. services industries shrank at the fastest pace in at least two decades as the destruction of the coronavirus took hold.
IHS Markit’s Purchasing Managers Index for the sector fell to 34.5 last month, the steepest downturn since the survey began in 1996. Only the technology sub-index showed signs of continued expansion.
The fallout from the disease is being felt the world over as economic activity comes to a standstill and unemployment claims shoot up. The outlook may not improve for some time as most of Europe and the U.S. remains in lockdown.
“Emergency public health measures to combat the COVID-19 pandemic continue to mothball business operations, force aggressive cutbacks on non-essential expenses and trigger distress for household finances,” said Tim Moore, economics director at IHS Market. The U.K. is “now almost certain to experience a deep contraction in the second quarter.”
Measures of output, new orders and unfinished activity all declined to record lows. The employment sub-index fell to the weakest since the financial crisis.
The IHS Markit PMI for the overall U.K. economy plunged to 36 last month from 53 in February. That’s the lowest since the series began in January 1998.
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