Welsh orders edge into growth as firms keep cutting jobs

New orders at Welsh businesses rose slightly in September after seven months of decline, while firms continued to cut jobs, according to the NatWest Wales Growth Tracker released on 14 October. The survey’s new-business index moved from 48.5 in August to 50.2 in September, crossing the 50 mark that separates an overall rise from a fall. The business activity index also increased, from 50.4 to 50.6.

Demand improves, employment still falls

The employment index rose from 45.3 to 47.3. That indicates a slower pace of job cuts, rather than a return to hiring growth: the measure remained below 50. The report says output growth was weaker than the UK average. Firms’ expectations for future activity improved from 58.9 to 67.5, reaching their highest level since January. Expectations describe respondents’ outlook, not growth already delivered.

Costs and selling prices diverge

The input-price index edged up from 65.9 to 66.5, while the selling-price index eased from 57.0 to 56.5. Costs and prices were still rising overall, but at different rates. These readings are survey index points, not percentage changes in prices, employment or output. They cannot be read as a 50.6% growth rate or an official count of jobs lost.

What the survey measures

S&P Global compiled the report from Welsh companies participating in its manufacturing and services PMI surveys. Responses were collected from 10 to 28 September and compare conditions with the previous month. The findings provide a timely view of business conditions, rather than a measurement of the whole Welsh economy. The improvement in orders therefore sits alongside an important qualification: staffing was still falling.