IT services crucial to UK economic recovery
Written by James West
The IT market is the brightest hope for a spluttering UK economy, after figures show it to be the prime contributor to a service sector growing at its quickest pace for four months.
While other key industry sectors such construction and manufacturing continue to tread water or sink respectively, and the eurozone and US economies are lurching towards crisis points, the service sector began a sustained growth surge in the spring. The Markit/CIPS services purchasing managers index scored the sector at 55.4, compared to 53.9 in June, with a score above 50 indicating expansion.
Yet not every business in the service sector is positively contributing, with hotel and leisure businesses continuing to suffer declining incomes because of the squeeze on consumer spending. However, demand for business and IT services is extremely high, indicating that organisations are looking to strengthen operations neglected during the recession. By building a strong IT platforms now, UK businesses are showing intent to be ready for when the economy is fully recovered, perhaps moving into 2012.
The resurgence in IT spending is currently limited to the UK market, with the report showing that overseas investment is weak, again reflected the shaky global economic outlook.