NCB report shows widespread optimism
Activity in Ireland’s services sector rose for the 39th month in a row in August, according to the NCB Purchasing Managers’ Services Index, released today.
Activity has now increased in each month since June 2003 and reports from firms linked the latest rise to higher new order volumes and the recruitment of additional staff.
New business volumes placed at Irish services providers also increased sharply in August.
Activity rose at a faster pace than the average for the current expansionary period. The rate of growth eased for the third month in a row and was the least marked since February 2006, however.
“Strength in services sector activity continues to be a key driver of the Irish economic boom,” said Dermot O’Brien, Chief Economist at NCB Stockbrokers.
“In August, growth remained robust and, though the overall activity index softened a little, the pace of expansion in new business, order backlogs and employment strengthened. Moreover, optimism remains very high in private service industries.”
Irish services companies recorded a strong rise in employee numbers in August. Staffing levels have now increased in each month of the past three years.
The rate of input price inflation was broadly unchanged since July. Reports from firms suggested that higher input costs had led to a fourteenth successive monthly rise in prices charged.
However, the rate of output price inflation was modest and the least marked for five months.
Irish service sector firms remained highly optimistic in August regarding the outlook for activity in 12 months’ time, according to the survey, with around 49% of firms anticipated that activity would rise over the coming year.
The survey covers all private sector services in Ireland, excluding retail and wholesale. The data are derived from questionnaires sent to a panel of around 600 Irish private services companies that have agreed to supply regular information on trends in their activity levels.
