THE North East private sector was broadly stable during December with slightly more new business coming in.
But companies continued to cut staff as they had done since May and say this is because they aren’t getting enough fresh work, they told the Lloyds TSB North East Business Activity Index.
There was a slight slowdown in business activity over the month, but this came as the holidays began and followed a nationwide trend. New business increased marginally during December, ending two months of reduction, with some businesses saying that client demand increased.
Companies continued to lower employment in December, and at a sharper pace than in the previous month. Staffing levels have decreased in each month since May 2012. Those respondents that cut staff said they had seen weakened demand.
Input costs increased but much more slowly than elsewhere in the country and where they did it was mainly because of higher fuel bills.
Companies raised their prices, as they had since May, and at a faster pace – particularly in the service sector.
Craig McNaughton, director for Lloyds TSB Commercial in the North East, said: “The end of 2012 saw private sector activity across the North East come to a dramatic slowdown, with business output broadly unchanged and only marginal growth in new orders recorded during December.
“This was broadly in line with the UK economy as a whole.”