CBI: small factory jobs growth hits 15-year peak

DOMESTIC demand for British produced goods picked up in the three months to January, boosting production for small manufacturers, a Confederation for British Industry (CBI) survey showed today.

And small and medium sized manufacturing companies are increasingly optimistic about export prospects for the year ahead.

While the growth in domestic orders remained modest, it accelerated at the fastest rate since January 1997, the CBI said.

And a positive balance of 10 per cent of surveyed manufacturers said they had increased employment -- the sharpest rate of growth since April 1995.

“Manufacturing is one of the few bright spots in the economy,” said the CBI’s Lucy Armstrong.

However, inflationary pressures are squeezing the UK’s factories.

A positive balance of 28 per cent of respondents reported an increase in average unit costs, while a balance of +31 per cent expect costs to further increase in the next quarter.

And manufacturers “are being forced to pass these costs onto customers,” Armstrong said.