East Midlands manufacturers forecast a 16 year record high in orders for the next quarter, higher than any other region, 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 Midlands.
According to the survey, a balance of 64% of local manufacturers’ anticipate a surge in demand in the coming three months, which would surpass the region’s highest ever level of orders since readings began in 1998. The data reveals this significant upturn in confidence comes as the UK economic recovery continues to take root in the region.
The aerospace and automotive industries continue to drive rising demand throughout the supply chain across the East Midlands. This is increasing the need for skilled workers, with an encouragingly continually strong balance of 21% of manufacturers planning on hiring new staff in the next quarter.
While output remained flat for the first quarter, there has been a strong increase in forecasted output for the coming months and a balance of 38% of local companies expect to see an increase, setting East Midlands’ manufacturers in great stead as they enter April.
The findings suggest that the East Midlands 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.
Richard Halstead, EEF Midlands Region Director, said: “Looking ahead to the next quarter, this is the most positive set of indicators we have seen in some time. Here in the East Midlands it looks like we’ve not just turned the corner, we’re actively heading down the right road. Manufacturers in general 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.”
Rick Wilson, partner at BDO LLP in the East Midlands, said: “As local manufacturers forecast a record high level of demand we expect to see the region continue to strengthen as the 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%.
