Manufacturing confidence falls in every UK region
Manufacturing News, Source : TheManufacturer.com
Published : 08 Aug 2005 10:59
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Business confidence has declined in every UK region for the first time in two years, as new orders continued to fall, according to the latest quarterly CBI/Experian Regional Trends Survey.
The widespread downturn in new orders was especially marked in the South East and London, which registered its sharpest decline in orders for seven years. The region appears to be among the worst affected by the weakness in domestic demand that has emerged in recent months, and has also failed to benefit from the upturn in exports seen in some other areas.
By contrast, export orders, which had declined in the two previous surveys, rose in five regions in the past quarter, and stabilized in two others.
Trends in manufacturing output over the past three months were very mixed. Wales experienced a sharp decline, the first in almost two years, and Yorkshire & the Humber also saw a sharp fall.
But the South West saw an encouraging rise and the West Midlands, after a year of steep falls, saw a modest increase - reflecting strong performances in the metal manufacturing and food, drink and tobacco sub-sectors.
Scotland and Wales appear to have escaped the worst of the problems facing UK manufacturing. In Scotland, there was an upswing in total orders, employment and output in the past three months and investment plans are much less downbeat than in most other parts of the UK.
According to Experian estimates based on the survey results, a further 18,000 jobs will be lost to manufacturing nationally in the current quarter, a large figure but still well short of the losses seen during the steep recession of 2001 to 2003.
Commenting on the survey, Doug Godden, CBI head of economic analysis, said: "This generally gloomy survey offers a slight silver lining, with the growth of companies' unit costs becoming more manageable. The South West has reported a reduction whilst everywhere else outside of Scotland and Wales has seen slower cost growth.
“Yet, despite this, firms are not enjoying a pick-up in profits, with their pricing power weakened in the face of tough conditions in the domestic market. Whereas, in April, factory gate prices increased everywhere outside the South West, this time, eight of the 11 regions are reporting net price reductions."
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