British manufacturers are continuing to enjoy a surge in performance on the back of a synchronised upswing in global markets according to the latest second quarter survey EEF, the manufacturers’ organisation and accountancy and business advisory firm BDO LLP.
Publishing the Q2 2017 manufacturing outlook survey, EEF pointed to a continued confidence that manufacturing will enjoy further expansion into the second half of this year, despite response balances easing slightly from the results of Q1, defying any predictions that political uncertainty caused by a snap election and Brexit may impact on business confidence.
While the export performance does have a currency aspect to it, the survey showed that manufacturers’ views of demand prospects in exports markets have become steadily more positive over the past year.
Demand in European markets looks especially buoyant with over three-fifths of companies reporting an upturn.
The survey also showed that, in contrast to recent years, positive output balances were reported across all sectors. However, those in the capital goods sector are performing especially well as global manufacturing intentions have increased.
A good pipeline of orders across the industry is pushing up demand for new employees and recruitment intentions soared to the highest level in three years, whilst investment intentions were in positive territory for the third quarter in a row.
EEF warned, however, that the current sweet spot for the sector cannot be guaranteed given the uncertainty ahead, in particular the likely continued squeeze on household incomes and the possibility of no deal on Brexit which could damage trade.
In response EEF is urging the new Government to press ahead as a matter of urgency with a bold industrial strategy to help cement long-term growth prospects for the sector.
EEF Chief Economist, Lee Hopley, said: “Our survey marks another quarter of positive news about growth prospects for UK manufacturers. Industry is reporting that output and orders have continued to head higher in recent months and the recovery in manufacturing globally is a big part of the story.
“It’s very encouraging that UK manufacturers have positioned themselves to capitalise on the windfall of a competitive pound and resurgent world economy.
“While growth and confidence hasn’t been knocked off track by the snap election, it is not plain sailing from here. There is the continuing challenge of managing input cost increases; ensuring success in attracting and retaining the skills that are in increasing demand and driving up investment in the sector.
“Whoever forms the next Government must set in stone as a matter of urgency a bold industrial strategy that will help cement the foundations for long-term growth for industry.”
Original article and Image – The Business Link