Factories Lead Robust Growth of Welsh Economy
Byline: By SION BARRY Western Mail
The Welsh economy expanded at a healthy pace in January, with the manufacturing sector leading the way, according to the latest Purchasing Manager' Index from the Royal Bank of Scotland.
Senior economist Robert Gardner said, 'The Welsh economy continued to expand strongly in January. Underlying demand was robust, as signalled by healthy gains in new business in the manufacturing and service sectors.
'There were also some encouraging signs that productivity growth may be stepping-up.
'Firms successfully dealt with new orders and made substantial inroads into their work backlogs, while at the same time marginally trimming staff levels.
'If sustained, improved productivity will help to support profit margins, which have been under pressure from rising input costs for some time.'
The PMI's seasonally adjusted business activity index moved even further above the 50 no- change level, reaching 55.2 at the start of the year, up from 54.4 in December.
Moreover manufacturing production grew more sharply than service sector output in January.
Service sector firms registered the stronger improvement in new business during January, which should help boost service sector activity in the months ahead.
The survey also showed there were some encouraging signs on the productivity front.
Although new workloads placed greater pressure on firms' operating capacities in January, companies made substantial inroads into existing workloads during the month, without increasing staff levels. …