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Home > News > Weak start...

Weak start for manufacturers and services - BCC

Manufacturing and services companies have got off to a weaker start in the first months of the year following a very strong performance in 2014, a new report from the British Chambers of Commerce (BCC) has revealed.

In its first quarterly economic survey of the year, the BCC reported that key balances in both sectors were lower than pre-recession levels in 2007.

In manufacturing, domestic sales dropped to 30 per cent from 36 per cent in the fourth quarter of 2014, while domestic orders also fell to 27 per cent from 38 per cent.

Companies in both sectors also reported lowering their investment intentions for training, plant and machinery.

But despite weaker results in most areas compared with the final quarter of last year, quarter-on-quarter trends indicate the economy is growing at a steady rate, albeit lower balances in terms of exports sales and investment.

Manufacturers also expressed profitability confidence, which rose to 47 per cent from 45 per cent at the end of last year.

"It is not a huge surprise to see slightly weaker numbers at the start of the year, after a very strong fourth quarter for many firms," said Chris Plant, a director at BCC.

"Crucially, our survey demonstrates that businesses remain optimistic, though they expect to grow at a slightly slower rate over the coming months.

"Our conclusions are by no means a cause for alarm, but they are a salutary reminder that the UK still faces obstacles on the path to sustainable, long-term growth.

"Unless support for exports and business investment is placed at the heart of any future government, consumption and government spending will continue to drive an economic recovery that is unbalanced and unsustainable."

 

Source: Insider News

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