Manufacturers optimistic for 2014, says EEF
- 17 March 2014
- From the section Business
UK manufacturers are enjoying a strong start to the year and are confident about the outlook, according to their industry body, the EEF.
Its survey of 322 companies, conducted during January and February, showed stronger output and orders than in the final quarter of last year.
Measures of recruitment and investment intentions were at the highest level recorded by the survey.
Export orders were up strongly from the previous quarter.
EEF chief economist Lee Hopley said: "This is the most positive set of indicators we have seen for some time, demonstrating that we've not just turned the corner, we're actively heading down the right road."
Ms Hopley added: "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."
The EEF survey, carried out jointly with accountancy firm BDO, concluded that the country's manufacturers were benefiting from a combination of strong UK sales and a boost in overseas trade.
In the rest of the world, particularly Europe, "the situation is more stable that it has been for a number of years and we've seen a pick up on export orders in our survey," Ms Hopley told Radio 4's Today programme.
The survey saw industries such as rubber and plastics production help boost output, as well as more traditional sources of growth in the UK, such as motor vehicle manufacture and aerospace engineering, said Ms Hopley.
However, the EEF added that the "ultimate test" for long-term economic recovery would be whether firms' intentions to invest and hire more staff could be translated into action.
"The Chancellor [George Osborne] must therefore gear his Budget this week to secure the best possible business conditions to support these investment and growth ambitions," the report said. "The key thing for manufacturers is what's happening to energy prices,'' said Ms Hopley, ahead of the Budget.
Jonathan Portes, director at the National Institute of Economic and Social Research said the recovery was being driven by consumer spending, which has been propped up by increasing house prices, which is ``the same old story for a British recovery.''
"Business investment is still well below where it was five or six years ago, so there's an awful lot of ground to make up," Mr Portes said on the Today programme.