South East manufacturers anticipate a significant increase in order levels and plan to hire more staff as a result in the coming months, according to the latest quarterly Manufacturing Outlook survey published today by EEF, the manufacturers’ organisation, and business advisers and accountancy firm BDO LLP in the South East.
While output remained flat in the first quarter of the year, a balance of 48% of local manufacturers’ anticipate a rise in orders in the next three months; reaching levels last enjoyed at the end of 2010. This is good news for South East companies and workers as a balance of 18% of regional manufacturers intend to recruit more employees over the next quarter; the highest level for two years.
Looking forward, local manufacturing output is due to increase over the next three months, with a balance of 57% companies predicting growth. The data reveals a positive outlook as local business confidence is bolstered.
The findings suggest that the South East is on track to mirror the UK as a whole, where the recovery is well underway and key indicators, such as output, orders, employment and investment intentions are approaching or have already hit record highs.
In the report, EEF says that translating firms’ intentions to invest and hire more staff into action will be the ultimate test for long-term economic recovery. It is calling on the Chancellor to gear his budget on March 19 to secure the best possible business conditions to support growth.
Jim Davison, EEF South East Region Director, said: “Looking ahead to the next quarter, this is the most positive set of indicators we have seen for some time. Here in the South East it looks like we’ve turned a corner and are actively heading down the right road. Manufacturers are clearly feeling more confident as their order books fill up and exports are strong. It is now vital that Government does all that it can to underpin support for companies, giving manufacturers the confidence to fulfil their investment and recruitment plans.”
Kevin Cook, partner at BDO LLP in the South East, said: “As local manufacturers forecast a significantly high level of demand and bolstered hiring intentions, we expect to see the region continue to strengthen as the overall UK recovery takes hold.
“The broad nature of the recovery that this survey points to is a source for particular encouragement as it has been some time since all sectors have been moving in the right direction. The fact that this is underpinned by a significant strengthening of exports, especially to Europe, adds further stability to the foundations of growth. This should also give confidence to the Government that its support for the sector is starting to achieve the desired results and if implemented in a clear and carefully targeted fashion will continue to reap benefits.”
EEF’s forecast for manufacturing growth in 2014 remains unchanged at 2.7%. However, EEF has increased its forecast for GDP growth to 2.6%.