Growth in the UK’s manufacturing sector was the strongest for 18 years according to the latest Confederation of British Industry (CBI) Industrial Trends Survey. Both the size of total order books and the pace of output growth over the past three months were the highest recorded since 1995, showing the recovery in UK manufacturing is accelerating.
The survey of nearly 350 manufacturers found that total order books relative to normal levels were their strongest since March 1995. Export order books were also very firmly above average.
Output volumes over the three months to November rose at their fastest rate since January 1995, with all but one sector (electrical engineering) reporting growth.
Manufacturers expect output growth to continue at a robust pace over the coming three months.
Stephen Gifford, CBI Director of Economics, said: “This new evidence shows encouraging signs of a broadening and deepening recovery in the manufacturing sector. Manufacturers finally seem to be feeling the benefit of growing confidence and spending within the UK and globally.
“Both order books and the pace of output growth are the strongest they’ve been since 1995, and firms are expecting similar-paced growth over the coming three months as well.
"But challenges remain. UK exporters need government support to break into high-growth export markets to reduce their vulnerability to any further Eurozone flare-ups."
Key findings:
* 36 per cent of firms reported that total order books were above normal in November and 25 per cent said they were below, giving a balance of +11 per cent, the highest balance since March 1995 (+11 per cent);
* 28 per cent reported that export order books were above normal in November and 27 per cent that they were below, giving a balance of +1 per cent, well above the long-run average of -20 per cent;
* The volume of output in the three months to November rose at its fastest rate since January 1995 (+29 per cent balance);
* Firms expect output growth to continue at a similar pace in the next three months: 44 per cent expect to raise output and 20 per cent expect to reduce output, giving a balance of +24 per cent;
* Stock adequacy of finished goods was below average (+7 per cent) for the third consecutive month, while expected price growth rose from October’s fifteen-month low to +5 per cent.
The CBI is the UK's leading business organisation, speaking for some 240,000 businesses that together employ around a third of the private sector workforce. With offices across the UK as well as representation in Brussels, Washington, Beijing and Delhi, the CBI communicates the British business voice around the world.
The November 2013 CBI Industrial Trends Survey was conducted between 24 October and 13 November. 345 manufacturing firms replied.