UK private sector downturn set to continue, CBI survey shows
By Benjamin Chiou
Date: Monday 01 Sep 2025
(Sharecast News) - Private sector firms across all major sectors in the UK expect economic activity to weaken in the coming quarter, according to the Confederation of British Industry's latest Growth Indicator.
The Growth Indicator's gauge measuring predicted output volumes over the coming three months registered a net balance of -15% in August, up from -18% in July but well behind the +9% level seen in August 2024.
The monthly composite index - a weighted percentage of companies reporting an increase minus those reporting a decrease - has been in negative territory since October last year.
The indicator tracking future business volumes was -15% for the services sector, -19% for the distribution sales sector and -13% in manufacturing.
"The outlook remains subdued across the private sector, as businesses continue to grapple with sluggish demand, higher employment costs, increasing uncertainty, and squeezed margins. However, expectations for activity are less negative than in the first half of the year, which is a thin silver lining," said Alpesh Paleja, the CBI's deputy chief economist.
In May, amid the launch of Donald Trump's trade war and ensuing bout of geopolitical uncertainty, the forward-looking monthly composite dropped to -30%.
However, despite the slight easing of negativity over recent months, there's "little evidence yet of a meaningful turnaround", Paleja said.
"Firms are increasingly focusing on building resilience and efficiency as they navigate a challenging economic environment - at the expense of capital spending and longer-term growth ambitions."
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