Manufacturing output soars to highest level in three years

The latest instalment of the closely-watched survey by manufacturers organisation EEF and business advisory firm BDO shows that just under 40 per cent of companies saw their output increase over the last quarter.

The data, published today, showed that whilst overall orders eased back slightly from last quarter, they remain strong with export orders especially positive at +29 per cent.

Both groups said this reflected the national picture of a sector benefitting from both a pick-up in the Eurozone and other growing markets around the world.

This strong performance has boosted business confidence amongst firms in Yorkshire, reflected in a continued demand for skills with recruitment intentions reaching the highest level for almost three years.

Furthermore, this increased confidence has passed through to investment intentions which have returned to the highest level for two years.

Andy Tuscher, region director for EEF in Yorkshire & Humber, said: “Manufacturers appear to have taken the recent political upheaval in their stride and are taking advantage of growing world markets to make hay while the sun shines.

“This period is likely to be the peak, however, and we are likely to see a more stable picture in the coming months rather than any further significant acceleration.

“There is little doubt that Brexit is likely to weigh on sentiment over the next twelve months with uncertainty over the UK’s terms of exit. As such, it is vital the Government sends a signal to industry and investors in the UK and overseas that it is doing everything in its power to get growth of the UK economy back on the agenda. This must include a bold and ambitious cross -government industrial strategy.”

Despite the buoyant picture, the cloud on the horizon remains the UK economy, with EEF’s indicator for the UK economy having slipped for the second quarter running in response to the continued political uncertainty and squeeze on consumer spending.

Craig Burton, partner and head of manufacturing in Yorkshire at BDO, said: “With growing opportunities around the world, particularly the Eurozone, manufacturers’ need stability and certainty in government policy (including Brexit) to provide the right environment for them to commit to the significant capital and research investment required to support continued growth.”