(Reuters.) Russia’s service industry activity declined in April for the 2nd month straight, prompted by weaker client demand, a fall in new orders and a reduction in customer purchasing power due to sanctions, according to a Friday business survey.

The S&P Global (NYSE:) Purchasing Managers’ Index (PMI) rose to 44.5 in April from 38.1 the previous month, which was its lowest since May 2020, but stayed below the 50 mark that separates expansion from contraction.

As they sought to lower costs, companies reported falling employment in the fifth straight month. However, the company also expressed concern over the prospects for next year.

Anecdotal evidence suggests that the introduction sanctions and lower client demand caused negative sentiment. The PMI report stated that although March was less optimistic than March, confidence levels were only second highest since May 2020.

Russian services providers announced a seven-month decline in monthly new orders. New export orders were also down.

The cost burdens of Russian services providers continued to increase markedly in April. They reported an increase on output fees, which rose at their second fastest rate since October 2001, when data collection began.

An earlier sister survey revealed that Russian manufacturing activity slowed for the third consecutive month in April. This was due to a slowing of output and lower employment.