PwC comments on S&P Global UK PMI data - February 2026

Commenting on the S&P Global Flash UK PMI data for February 2026, Jake Finney, Senior Economist at PwC, says:

“The February flash PMI suggests the economy has held on to the momentum seen at the start of the year, with private sector activity expanding at a solid pace for a second consecutive month. That marks a clear improvement on much of last year. If sustained in March, this reading would be consistent with growth of over 0.3% in the first quarter of the year, the strongest performance since the rebound at the start of 2025.

“However, the weakness in the employment component still stands out. Employment declined for a seventeenth consecutive month, in line with the softness seen in the payroll data. This adds to a growing body of evidence that rising labour costs are weighing on hiring decisions, particularly in the services sector.

“With activity continuing to expand while employment contracts, output per worker appears to be picking up. The longer that dynamic persists, the more it raises the prospect of a genuine turnaround in productivity for the first time since the global financial crisis. One possibility is that higher labour costs are prompting firms to invest more heavily in capital and technology. Whether this proves to be a lasting shift is the key question.”