Member Article

Manufacturing optimism unaffected by output falls

Manufacturing figures released today showed that while orders fell in the three months up to October, output has plateaued according to business lobbyists, CBI.

The organisation reported that 28% of manufacturers surveyed said output had fallen, while 25% said it had risen.

This resulted in an overall 3% fall in output, which is the lowest figure since the 8% fall reported in October 2009.

Despite these dismal statistics, businesses remain optimistic for the future, and predictions of 12% growth increases were reported, which CBI said will be the strongest growth since the three months up to January 2011.

CBI said concerns among manufacturers over political and economic stresses were higher than the previous quarter, and 34% of companies reported that this would impact on how much they limit export orders, in comparison with 25% in the three months up to July.

An unexpected drop in order volumes did not effect predictions for the next quarter, although domestic orders were down 10%, and export orders fell by 17%.

Employment prospects, however, improved in Wednesday’s figures, with a 5% rise in the number of people in manufacturing jobs, which is the ninth consecutive quarterly rise.

Anna Leach, CBI’s Head of Economic Analysis, commented: “Sentiment regarding business conditions has … fallen back, particularly for exports.

“UK companies are increasingly concerned by political and economic conditions abroad, whether it is ongoing weakness and uncertainty in the Eurozone or the approaching fiscal cliff in the US.

“Nevertheless, underlying conditions seem relatively stable in this survey. Employment has continued to rise, investment intentions remain reasonably healthy, and expectations for output and orders have held up.”

This was posted in Bdaily's Members' News section by Miranda Dobson .