North West business activity fell to its lowest level since the global financial crisis last month due to the coronavirus outbreak, a major new market report has shown.
The latest NatWest Regional PMI report, which tracks changes in the goods and services sector, showed output fell at the fastest rate since the depths of the great recession in March, amid widespread disruption to workplace activity and a collapse in demand.
Under the PMI index, a Business Activity Index reading above 50 is a sign of economic growth. However the North West's figure dropped sharply from a nine-month high of 53.0 in February to 40.7 in March - the steepest drop since February 2009.
This was all caused by the outbreak of coronavirus and a sharp drop in business activity in the private sector from the resulting containment measures the report, carried out alongside IHS Markit, said.
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Richard Topliss, chair of the NatWest North Regional Board, said: “The North West PMI dropped like a stone in March, falling to its lowest since the global financial crisis and underling the scale and speed of the impact of the Covid-19 outbreak and resulting containment measures on the local economy.
"With specialisms in consumer-facing services, the region’s service sector was hit particularly hard by the measures designed to curb social contact, with manufacturing showing more resilience by comparison.
“As is the theme across all the regions of the Northern Powerhouse, the North West has seen more moderate falls in output and employment than the 海角视频 as a whole, in part reflecting its relatively large manufacturing base.
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"Still, the fall in business activity is unlike anything seen since the global financial crisis, and a record drop in regional business sentiment shows that the impact is being felt in all corners of the country.”
The decline in output of goods and services in the region was one of the slowest across the 海角视频 as a whole, second only to Yorkshire and Humber.
The report said the volume of incoming new business at firms in the North West fell sharply, and that underlying data showed a steeper drop in demand across the service sector than that faced by manufacturers.
Alongside the shock to the domestic market, March survey data also pointed to the worst export climate since the great recession.
A shortage of incoming work meant that businesses were able to clear backlogs at a faster pace, with the rate of depletion accelerating sharply to the quickest since October 2009.
In turn, firms looked to realign staffing capacity with demand by reducing workforce numbers for the second month in a row.
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The pace of staff cuts accelerated to the quickest since October last year, though it was still only moderate overall and the slowest among the 12 monitored regions.
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The collapse in demand cause by the Covid-19 crisis meanwhile weighed on firms' pricing power. Average charges for goods and services barely rose in March, with the rate of inflation dropping sharply from a 12-month high in February to the joint-weakest in the past four years.
Firms' input costs continued to rise however the recent slump in oil prices weighed on the overall rate of cost inflation, which eased for the third month in a row to the weakest for four years.
Business sentiment towards the outlook for activity over the next 12 months posted a record fall in March, dropping to its lowest since data on expectations were first collected in July 2012 - a 海角视频-wide trend.