Services sector outlook subdued for H2

Hoteliers are amongst the most optimistic whilst retailers expect lower turnover.

The gap between the number of firms in the services sector expecting more favourable or slower business for H2 narrowed to a net weighted balance of +2%, data from the Department of Statistics revealed. This is weaker than the +4% net weighted balance for April to September 2019 and the +9% recorded for the same period last year.

According to the results of the Business Expectations Survey, firms in the accommodation and the food and services industries were the most optimistic with a weighted net balance of +25% and +9%, respectively, both boosted by the year-end festive season. Hoteliers also expect improved business due to the upcoming Formula One night race in September.

In contrast, firms in the retail trade industry foresaw less favourable business situation with a -7% weighted net balance. Firms in the wholesale and the financial and insurance industries were also less optimistic for H2 with a -4% and -3% weighted net balance, respectively, citing the ongoing trade tensions.

Similarly, the accommodation and the food and services industries recorded the most positive employment outlooks with weighted net balances of +14% and +29%, respectively; and higher operating receipts at +37% and +26%, respectively. The real estate industry also expect to increase hiring with a +22% weighted net balance.

On the other hand, the retail trade industry alone expects a lower turnover and a negative employment outlook and a negative, at -9% and -4%, respectively

The survey covers about 1,500 enterprises in wholesale trade, retail trade, transport and storage services, accommodation, food and beverage services, information and communications services, financial and insurance services, real estate, business services (excluding real estate) and recreation, community and personal services.