(Bloomberg) -- Britain’s private sector companies reported slower growth and stronger pressures to increase prices in the lead up to the general election, a closely watched industry survey showed.

S&P Global’s composite Purchasing Managers’ Index slipped to 51.7 in June from 53 the month before, the lowest reading since November when the nation was in a mild recession. The reading was worse than the 53 economists expected but still above the threshold of 50 that indicates expansion.

The report also showed inflationary pressures, driven by a jump in wages and rising prices for goods. The figures may signal a continuation of a stagnation in the overall economy recorded by official data in April, though S&P said some of it was due to a pause in investment decisions ahead of the election on July 4.

“Companies’ costs are rising, most notably in manufacturing, where shipping costs in particular are spiking again and adding to a renewed rise in inflationary pressures from goods, ” Chris Williamson, chief business economist at S&P Global Market Intelligence, said in a report Friday.

The figures indicate the economy is growing at a quarterly rate of just over 0.1%, Williamson said. That’s weaker than the Bank of England estimates. However, the findings on prices may feed lingering concerns that inflation could stick around longer than policymakers hope.

S&P’s headline reading for manufacturing rose to a 23-month high, while the services indicator fell to the lowest in seven months. A measure for input price inflation rose from a 40-month low touched in May, which S&P said was due to a “steep increase in transport costs linked to global shipping bottlenecks.”

An index of prices charged by private-sector companies rose to a four-month high in June, the first increase in the pace of inflation since February. The cost of goods leaving factory gates rose at the strongest pace since May 2023.

Wages were a main driver for prices. Employment in the private sector has risen every month this year by S&P’s measure. Companies, the researcher said, face “hiring difficulties” and are creating jobs at a slower pace than in previous months. 

“The slowdown in part reflects uncertainty around the business environment in the lead up to the general election, with many firms seeing a hiatus in decision making pending clarity on various policies,” Williamson said.

--With assistance from Joel Rinneby and Mark Evans.

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