• Output contracts in nine of out 12 monitored regions and nations
  • Local labour markets under pressure but showing signs of resilience
  • Input cost inflation generally slows


Most areas of the UK saw a fall in business activity in October amid broad weakness in demand, according to the latest NatWest Regional PMI® survey. Employment also declined in the majority of cases, albeit generally more slowly than in September. More often than not, business costs rose at a slower rate in October.         

The PMI Business Activity Index is the first fact-based indicator of regional economic health published each month, tracking the monthly change in the output of goods and services across the private sector. A reading above 50 signals growth, and the further above the 50 level the faster the expansion signalled.

London remained the UK's top-performing region for output growth in October, its business activity index coming in at 53.8. It was one of just three areas (out of 12 monitored) where output rose during the month, alongside the West Midlands (50.7) and South West (50.1). Firms in the North East (43.5) recorded the most marked decline in business activity, followed by those in Wales (45.0).



Of the 12 monitored nations and regions, only London and the West Midlands recorded a rise in new business in October, with both seeing rates of growth quicken. The broader trend was one of weaker demand for goods and services, however. Firms operating in Yorkshire & Humber noted the steepest drop in new work, the sharpest in the region for nearly three-and-a-half years, followed by those in Wales.   



Business costs generally increased more slowly in October, with only Wales, Northern Ireland and the North West seeing rates of input price inflation quicken. Firms in London recorded the steepest overall rise in operating expenses, albeit the slowest in the region since April 2021, while those in the West Midlands faced the weakest increase.    

Average prices charged by businesses rose across all monitored nations and regions in October, and at quicker rates in half of cases. The strongest increase by far was recorded in London, which topped the rankings for the third time in the past four months. Companies in Northern Ireland recorded only a marginal rise in output prices, the weakest in just over three years.   



Seven out of the 12 monitored regions and nations posted lower employment in October. However, this was down from ten in September, and where workforce numbers fell, rates of job shedding often eased. Scotland topped the rankings with a modest rise in staffing levels, with the West Midlands, Northern Ireland*, North West and East of England also seeing increases.  

For the fourth successive month, all areas of the UK saw a decrease in outstanding business (i.e. orders not yet started or awaiting completion). As was the case for new business, the sharpest drop in backlogs of work was in Yorkshire & Humber, followed by Wales. At the other end of the scale, firms in London recorded only a marginal decline.         



Confidence towards future activity weakened across the vast majority of areas in October, with only the South West and Wales going against the trend. Nevertheless, expectations were optimistic across the board, and nowhere more so than in the West Midlands, which topped the rankings for a fourth straight month ahead of the South East.  


* PMI survey coverage in Northern Ireland includes construction and retail, as well as manufacturing and services.


Sebastian Burnside, NatWest Chief Economist, commented:

"Most regional economies remained under pressure at the start of the fourth quarter, with activity falling in nine of the 12 monitored areas.

"London remains the main bright spot, having seen activity not only grow in October, but also at a solid rate. Businesses in the capital are reporting robust customer demand, which contrasts with the situation in almost every other area.

"There has been greater caution around hiring in recent months as businesses contend with lower activity and rising costs, and we saw further evidence of this in October as employment once again fell across the majority of areas. However, the latest results did at least point to some signs of resilience across local labour markets, with rates of job shedding generally easing and three regions even recording renewed rises in employment.      

"Whilst business costs generally rose more slowly in October, this didn't always translate into slower increases in prices charged for goods and services as rates of inflation ticked up in half of cases. There is some stickiness in inflationary pressures, driven by ongoing wage increases and the recent resurgence in fuel prices."

Notes to editors


The NatWest UK Regional PMI® data are compiled by S&P Global from responses to questionnaires sent to companies that participate in S&P Global’s UK PMI surveys. S&P Global compiles data for nine English regions, Scotland, Wales and Northern Ireland (NUTS 1 definitions).

Survey responses are collected in the second half of each month and indicate the direction of change compared to the previous month. A diffusion index is calculated for each survey variable. The index is the sum of the percentage of ‘higher’ responses and half the percentage of ‘unchanged’ responses. The indices vary between 0 and 100, with a reading above 50 indicating an overall increase compared to the previous month, and below 50 an overall decrease. The indices are then seasonally adjusted.

The headline figure for each region is the Business Activity Index. This is a diffusion index calculated from a single question that asks for changes in the volume of business activity (at service providers) or output (at manufacturers) compared with one month previously. The Business Activity Index is comparable to the UK Composite Output Index. It is sometimes referred to as the ‘PMI’, but is not comparable with the headline UK Manufacturing PMI figure.

Underlying survey data are not revised after publication, but seasonal adjustment factors may be revised from time to time as appropriate which will affect the seasonally adjusted data series.

The survey data for October were collected 12– 27 October 2023.

For further information on the PMI survey methodology, please contact economics@spglobal.com.

About PMI

Purchasing Managers’ Index (PMI®) surveys are now available for over 40 countries and also for key regions including the eurozone. They are the most closely watched business surveys in the world, favoured by central banks, financial markets and business decision makers for their ability to provide up-to-date, accurate and often unique monthly indicators of economic trends. To learn more go to www.spglobal.com/marketintelligence/en/mi/products/pmi.

About S&P Global (NYSE: SPGI)

S&P Global provides essential intelligence. We enable governments, businesses and individuals with the right data, expertise and connected technology so that they can make decisions with conviction. From helping our customers assess new investments to guiding them through ESG and energy transition across supply chains, we unlock new opportunities, solve challenges and accelerate progress for the world.

We are widely sought after by many of the world’s leading organizations to provide credit ratings, benchmarks, analytics and workflow solutions in the global capital, commodity and automotive markets. With every one of our offerings, we help the world’s leading organizations plan for tomorrow, today. www.spglobal.com.


The intellectual property rights to the data provided herein are owned by or licensed to S&P Global and/or its affiliates. Any unauthorised use, including but not limited to copying, distributing, transmitting or otherwise of any data appearing is not permitted without S&P Global’s prior consent. S&P Global shall not have any liability, duty or obligation for or relating to the content or information (“Data”) contained herein, any errors, inaccuracies, omissions or delays in the Data, or for any actions taken in reliance thereon. In no event shall S&P Global be liable for any special, incidental, or consequential damages, arising out of the use of the Data. Purchasing Managers’ Index™ and PMI® are either trade marks or registered trade marks of S&P Global Inc or licensed to S&P Global Inc and/or its affiliates.

This Content was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global. Reproduction of any information, data or material, including ratings (“Content”) in any form is prohibited except with the prior written permission of the relevant party. Such party, its affiliates and suppliers (“Content Providers”) do not guarantee the accuracy, adequacy, completeness, timeliness or availability of any Content and are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, or for the results obtained from the use of such Content. In no event shall Content Providers be liable for any damages, costs, expenses, legal fees, or losses (including lost income or lost profit and opportunity costs) in connection with any use of the Content.

Economic Analysis
Supporting Individuals
Press Release
scroll to top