Manufacturing industry is starting to pick up again, according to the Confederation of British Industry’s latest Quarterly Industrial Trends survey.
Business confidence rose at its fastest rate since April 1995. Twenty eight per cent of firms were more optimistic than four months ago, while 15% were less optimistic, giving a positive balance of 13% – up from 5% in July.
For the first time since early 1998, more manufacturers predicted orders will rise than fall – a positive balance of 4% compared with -4% last month. This improvement is expected to be driven by better domestic orders, with exports continuing to fall slightly.
The outlook for jobs is still poor, however – a balance of 16% of companies expect to lose staff over the next four months. This compares with a balance of 14% which lost staff over the previous period.
Overall manufacturing output levelled out after falling continuously since July 1998. Output is expected to rise over the next four months, with a positive balance of 12%.
Capital expenditure will continue to fall, held back by inadequate returns. But spending on training (12% balance) and products and process innovation (11% balance) should rise over the coming year.