COVID-19 Impact: Service sector declined for the third consecutive month in July, further reduction in jobs

PMI Services: The service sector declined in July due to massive reduction in business activities, new orders and employment due to the outbreak of the virus pandemic and local restrictions.

service sector

India’s service sector declined for the third consecutive month in July due to a massive reduction in business activities, new orders and employment due to the outbreak of the coronavirus pandemic and local restrictions. India Services Business Activity Index stood at 45.4 points in July, as against 41.2 points in June. Purchasing Managers’ Index (PMI) A score above 50 indicates expansion in activity, while a score below 50 indicates contraction.

Pauliana de Lima, Joint Director of Economics at IHS Markit, said, “The environment surrounding the COVID-19 pandemic is taking a toll on the performance of the services sector, while this sector is extremely important for the Indian economy. is important. The figures for July are somewhat disappointing, although the pace of decline has slowed down.

Service sector jobs further reduced

According to the survey, for the first time, companies were pessimistic about production in the next one year. Lima said that uncertainty over the end of the pandemic, as well as inflationary pressures and financial troubles, dampened business confidence in July. Service providers were pessimistic about the business activity outlook for the first time in a year. According to the survey, there was a further reduction in service sector jobs during this period.

Manufacturing activity jumped in July

However, despite the second wave of Corona, economic activity has improved in July. The Manufacturing Index of India for the month of July stood at 55.3. In the month of June, this index stood at 48.1 due to the local lockdown in different parts of the country. When this index is above 50, it indicates growth, while below 50 it indicates decline.

In the month of July, the GST collection again crossed one lakh crore. In the month of July, the GST collection stood at 1 lakh 16 thousand 393 crores. It registered a growth of 33 per cent on a yearly basis. For eight consecutive months, the GST collection was crossing 1 lakh crore, but in the month of June it was 92,849 crore.

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