MANUFACTURERS reported the fullest order books in six years this September, as the most recent Confederation of British Industry (CBI) survey reveals a strong performance.
A full 28 per cent of firms said their order books were busier than normal, while only 19 per cent said they were below their usual level. Orders have risen for five months in a row.
The measure now stands at a net balance of nine per cent, up from only two per cent in August.
This month’s survey showed the largest positive result for the index since August 2007, before the impact of the financial crisis.
The CBI’s director of economics Stephen Gifford said: “This month’s results show the manufacturing recovery continuing to gather pace... firms are ramping up production to meet demand.”
Other indicators also pointed towards a strong third quarter for the UK’s manufacturing growth: in the three months to September, 39 per cent of firms reported that output was growing, while only 21 per cent said that output fell.
After a recent run of good news about the British economy, including 0.7 per cent growth in the second quarter, companies have the most
positive expectations since 1995.
Four times as many companies expect to increase their manufacturing output at a faster pace in the next three months than they have in the last quarter.
Samuel Tombs of Capital Economics commented: “While we still worry that the manufacturing recovery will struggle to sustain quite such a strong pace of growth for much longer, for now at least, a strong recovery appears to be in motion.”
IHS Global Insight’s chief UK economist, Howard Archer, added: “Although global economic conditions are still challenging, the prospects for UK manufacturing export orders are being helped by the Eurozone finally exiting recession in the second quarter and seemingly on course for modest growth in the third quarter.”