LONDON: The UK service sector felt the adverse effects of a downturn in consumer spending in the year's first quarter, reporting the sharpest drop in business activity for almost seven years.

The Confederation of British Industry says restaurants, bars and cinemas are seeing a notable slide in trade as the public tightens its belts. Only the travel sector has posted an increase in business.

Comments CBI chief economic advisor Ian McCafferty: "People are more inclined to take a well-earned break as rising costs put greater demands on household spending."

The CBI's Q1 report said the balance of consumer services firms revealing a fall in business volumes was -44%, the lowest since November 2001.

Profitability was the weakest since the survey began ten years ago, while employment in the sector fell for the second quarter in a row.

But professional services, such as law, accountancy and IT reported growth during the period.

Data sourced from BBC Online; additional content by WARC staff