Manufacturing Growth Underpins Wider Recovery, say Economists
The biggest increase in manufacturing output in six months will help ensure the UK economy continues to grow, economists have said.
New government figures have revealed that manufacturing output grew by 0.6% in October, the biggest increase since March, and was up by 5.8% on the same period in 2009.
“These figures are better than expected, and provide welcome confirmation that the recovery in manufacturing is gathering momentum,“
said British Chambers of Commerce (BCC) chief economist, David Kern.
“We believe that this will ensure that GDP growth remains positive in the fourth quarter of 2010, albeit at a slower pace than in the third quarter.”
Kern added that the continued growth of the manufacturing sector was essential to maintain the wider economic recovery.
“It’s crucial the Government helps manufacturing companies retain valuable skills and ensures that UK exporters are not at a disadvantage when it comes to trade finance or expanding their premises.”
The Manufacturing Advisory Service West Midlands‘ chief executive, Simon Griffiths, welcomed the continued growth of the manufacturing sector.
“However, there are concerns about the public sector cuts and how they might affect growth.”
“There is not a consistent level of demand coming through, particularly at the smaller end of the market. So small firms have to ensure they are in a good position with multiple customers in multiple markets.”
Confederation of British Industry divisional chief executive, Andy Reynolds Smith, said that the UK manufacturing sector would need to develop its industrial capability at home and internationally to remain competitive.
“The rise of emerging economies, such as India and China, is creating a new generation of consumers eager to buy goods and enjoy a better lifestyle. But competition for these markets will be fierce, as will the fight to attract and retain manufacturing investment to strengthen the base at home.”