The UK's Manufacturing Outlook Continues To Improve, Reports The CBI

UK manufacturers face improving economic conditions, according to the latest CBI Industrial Trends Survey.

Despite nine firms surveyed confirming slower than expected growth in the last three months, 16 companies look ahead to a healthy expansion over the coming quarter.

The new study from the CBI found that in 414 cases export order books increased, maintaining strong levels that were reported in June and became widespread across other sectors.

Companies could have been motivated by their expectation that output would progress in a robust manner over the next quarter - as product satisfaction continued to improve, with figures showing that the benchmark reached its highest level of the year.

Katja Hall, CBI deputy director-general, commented: "The outlook for UK manufacturers remains healthy, with both total and export orders firming up. Despite a dip in the pace of output growth, companies expect a strong pick-up in the next three months.

"But with growth flat at best in the Eurozone and Sterling having risen in recent months, there are still some headwinds to export demand. We need more manufacturers exporting to high-growth markets, which will help to put the recovery onto a more balanced, sustainable footing."

Despite the positive outlook of many firms, the CBI reports that there are too many people that are unemployed across the UK.

Figures from the latest ONS labour market data study for the three months to June show that whilst unemployment fell, there are still 767,000 young people that are unemployed.

John Cridland, CBI director-general, believes that although unemployment has fallen in the last few years, there are still too many unemployed young people -adding that they should be given an equal opportunity to display their abilities and skills to companies.

He also suggested the government must help to improve education to increase students' chances of making their way into a successful career, ensuring the talent of the current generation is not wasted.

Expert Opinion

It is very positive to see these figures which reflect that the manufacturing sector, like many others at this time, is in a positive period where many businesses are confident about future prospects and their growth ambitions. <br/> <br/>"It has undoubtedly been a difficult few years for many businesses, but the economy’s continued improvement has meant many are now planning their next step towards expanding their operations. <br/> <br/>"Manufacturers need to recognise the benefits of having a quality support network on hand to advise them, with legal experts being part of that mix to help with any of the growing pains which development may bring. These could vary from employment law issues to other matters such as commercial property or corporate advice." Dorrien Peters - Partner