Service sector profitability at lowest level in four years
UK service sector profitability was at the lowest level in four years at the beginning of 2018 in a drop that was driven by the struggling high street.
The area saw the sharpest decline in a year between January and March this year due to poor general retailer performance, the Office for National Statistics (ONS) said.
Profit warnings were issued by 13 high street retailers as wage growth did not drive spending due to high amounts of unsecured debt and low level savings.
The net rate of return in the service sector fell from a revised estimate of 18.4 per cent in the final quarter of last year to 17.1 per cent in the first three months of 2018, which is the lowest level since 2013.
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UK continental shelf companies saw the third quarterly increase in a row during the period as growing global demand and restricted supply raised the price of oil from $67 (£51.8) to $70 per barrel at the end of March.
The sector recorded an estimated net rate of return of 7.3 per cent, up 0.6 per cent on the fourth quarter of 2017.
The UK saw the largest fall in profit share when compared to France, Germany and Spain as it fell 0.5 per cent to 43.8 per cent.
Gross domestic product grew by 1.8 per cent last year, which is 0.6 per cent lower than EU GDP growth.
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