Industrial output plunges after bank holiday bonanza

UK industrial production slumped 1.7 per cent in April compared with March as oil and gas related industries saw double-digit output declines, official figures have showed.

Factory output in the UK fell 1.5 per cent in April on a monthly basis after production reduced at transport, machinery and metals producers.

Output fell 1.2 per cent compared with April 2010, but manufacturing output was 1.3 per cent higher this year compared with 2010.

And the food, drink and tobacco industries registered an 0.9 per cent increase in production in the month.

The falls in output were attributed to the extra public holiday and late Easter, which shut down factories twice in the same month.

Supply chain disruption following the earthquake in Japan in March also affected some producers.

Economists lamented the data, with Chris Williamson, chief economist at Markit, describing the performance as “shockingly weak”.

“It would be wrong to get too concerned over these figures, but it would also be wrong to dismiss them as merely signalling a temporary set-back,” he said.

“It suggests that one of the most important sources of momentum in the recovery is fading and represents a major turnaround in the health of the manufacturing sector, from surging, export-driven growth at the start of the year.”

Howard Archer, chief UK economist at IHS Global Insight, said the plunge was greater than expected.

“Manufacturers now appear to be finding life more challenging as stock rebuilding wanes and tighter fiscal policy weighs down on domestic demand. There are also signs that global demand is slowing as export orders fell back markedly in May,” he said.

The April falls compare with year-on-year growth of 0.1 per cent industrial production and 2.2 per cent manufacturing growth in March.