The UK’s supply chain crisis has dragged growth down to a six-month low, as companies struggle to handle shortages of staff and raw materials.
Activity weakened across the service sector in August, and rose at the slowest since the recovery began in March after the lockdown eased. Backlogs of works built up despite a surge in hiring.
That’s according to the latest IHS Markit/ CIPS UK Services PMI Business Activity Index, just released — matching a similar slowdown at factories reported earlier this week.
This slowdown is partly due to a return to more normal demand after the initial post-pandemic surge.
But there were also widespread reports that shortages of staff and disrupted supply chains had constrained growth in August, says Markit — as the lack of key workers such as lorry drivers hits retailers.
Services companies also reported a “solid increase” in backlogs of work across the service economy, which were overwhelmingly blamed on staff shortages.
Companies surveyed in the report pointed to unexpectedly high levels of employee turnover, as well as…
