ONS reports 1.1 per cent growth in manufacturing sector

Figures released today show that GDP increased by 0.5 per cent in the first quarter of 2011, following a decrease of 0.5 per cent in the fourth quarter of 2010.

According to the Office of National Statistics (ONS), the effect of the abnormal weather conditions in December 2010 is estimated to have subtracted 0.5 per cent from growth in the fourth quarter. GDP is estimated to have now returned to the level in the third quarter of 2010.

Total production output rose 0.4 per cent in the first quarter of 2011, compared with an increase of 0.8 per cent in the previous quarter.

The largest contribution to growth came from manufacturing, which increased by 1.1 per cent compared with a similar increase of 1.1 per cent in the previous quarter.

Commenting on the GDP data, Lee Hopley, chief economist for EEF, said: ‘The recovery in manufacturing output maintained its momentum in the first three months of the year.

‘In line with predictions, the sector has now posted six consecutive quarters of robust expansion, while the rest of the economy only just made up the ground lost at the end of last year.’

Phil Orford, chief executive of the Forum of Private Business, suggested that economic growth would be bettered in the next quarter if conditions were improved for small businesses.

‘If smaller companies are to foster a genuine and meaningful recovery, they need to be freed from… red tape, benefit from a simpler and more sympathetic tax system, and see the soaring costs of essentials such as fuel and utilities tackled,’ he said. ‘This in turn should help to bring about the second thing we need to see — a significant increase in business and consumer confidence.’