Key facts
- Britain's services sector contracted for a second consecutive month in June, with the PMI falling to 48.8.
- New work in the services sector contracted at the fastest pace since November 2022.
- Business sentiment in Britain was the second-lowest since April 2025.
- Hiring has contracted for 21 consecutive months, the longest period of job shedding since February 2010.
- Input cost inflation eased slightly but remained strong, partly due to rising salaries and transport costs.
Activity in Britain's services sector contracted for a second consecutive month in June, with the S&P Global Purchasing Managers' Index (PMI) falling to 48.8 from 49.3 in May. This marks the weakest performance since January 2023. The decline was driven by a sharpest fall in overall new work since November 2022, attributed to concerns over political uncertainty, global inflationary pressures, and the ongoing Middle East conflict. The composite PMI, which includes manufacturing data, also fell to 49.3, indicating a broader economic slowdown. Business sentiment for the next 12 months reached its second-lowest point since April 2025, though some optimism stemmed from hopes of a peace deal between the United States and Iran and investment in artificial intelligence. Hiring has now contracted for 21 consecutive months, the longest continuous period of job shedding since February 2010. While inflation pressures eased slightly, they remained strong, with rising salaries and transport costs contributing to higher input costs for businesses.