Monday 22 June 2020 1:23 pm

UK factory output falls at fastest pace since records began

Britain’s manufacturing output has fallen at its fastest pace since records began during the three-month coronavirus lockdown.

It comes as the sector remains in a deep downturn because of the pandemic, according to the latest report on UK factories by the Confederation of British Industry.

Read more: UK retail sales start to rebound in May following record drop

The CBI’s manufacturing output gauge dropped from minus 54 per cent in May to minus 57 per cent this month.

The fall was the largest since records began in 1975.

Moreover, there was no evidence that the jump in online shopping brought about by the lockdown had helped drive any demand for manufacturing.

Of the 360 firms that responded to the survey between late May and mid-June, 17 per cent said they had produced more and 74 per cent less in the latest three months than in the quarter ending in March.

Despite a small recovery for order books, the CBI added they they still remained weak by historical standards.

Just 13 per cent of firms said order books were better than usual for this time of year, while 71 per cent said they were worse than normal.

The balance of minus 58 points compared to minus 62 points last month.

Meanwhile, export order books got even worse in June to their lowest level on record, the CBI said. 

Only two per cent of respondents said they were better than normal against 81 per cent who said they were worse than normal.

Anna Leach, the CBI’s deputy chief economist, said: “The UK manufacturing sector remained in a deep downturn in June due to the ongoing Covid-19 crisis. 

“Output volumes declined at a new record pace and export order books fell to an all-time low, reflecting the significant fall in demand in the UK and abroad. 

“Firms are again hoping this will ease somewhat in the next three months.”

Read more: US manufacturing remained in ‘deep downturn’ in May

“The government has already undertaken a huge amount of work to provide financial lifelines to businesses throughout this unprecedented period. 

“With firms having been encouraged to restart operations, the government must continue to engage with the sector to understand their specific concerns and provide support as needed.”

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