Britain's dominant services sector swung back into growth in July, with the S&P Global UK Services PMI climbing to 52.1 from a contractionary 48.8 in June. New orders picked up and business confidence hit its best level since February, even as employment fell for a 22nd straight month, matching the longest run of job losses in the survey's three-decade history.
Britain's services industry returned to expansion last month, with the S&P Global UK Services PMI climbing to 52.1 in July from 48.8 in June, beating an earlier flash estimate of 51.8. The composite index, which folds in manufacturing, rose to 52.2 from 49.3, pushing both gauges above the 50 mark that separates growth from contraction for the first time since April.
New orders return as the Iran war's drag fades
The index of total new work among services firms rose to 50.8 from 47.6, the strongest reading since February and the end of a four-month slide that began when the Iran war broke out. New export orders fell for a fifth straight month, though at the mildest pace of that run. Higher consumer spending and steady demand for technology services drove the rebound, while manufacturing output logged its strongest increase since September 2024.
Cost pressures ease as the ceasefire cools oil prices
Input-cost inflation across the sector slowed to its weakest pace since February, as a ceasefire in the Iran war pushed down oil and gas prices. Prices charged by services firms then rose at the slowest rate in five months, the survey showed.
Confidence climbs even as job losses set a record run
Employment across the sector fell for a 22nd consecutive month, equalling a run last seen during the global financial crisis almost two decades ago. That stretch also ties the decline that followed the dot-com bust, matching the longest run of job losses in the survey's 30-year history. Still, the pace of decline was the softest since October 2025.
Business activity expectations for the next 12 months also improved. According to InvestingLive: "reached the highest level since February", Tim Moore, economics director at S&P Global Market Intelligence, said.
Sources: Investing.com, ActionForex, InvestingLive
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