According to the Q4 EEF/BDO Manufacturing Outlook report output has fallen slightly to a balance of +25% though above the long-term average. Tony McDonough reports
Manufacturers in the North West are remaining resilient in the face of Brexit uncertainty, weaker global growth and US protectionist policies, a new survey shows.
According to the Q4 EEF/BDO Manufacturing Outlook report output has fallen slightly to a balance of +25% though above the long-term average, whilst domestic orders also fell slightly to a balance of +22%, though still above the average for other UK regions.
Export orders, which have been a big driver for manufacturing in recent years, also fell slightly to +22% though this was from a record high in the third quarter. This weaker picture is reflected in weaker recruitment while investment intentions fell to a balance of zero after five quarters of expansion.
Whilst EEF, the manufacturers’ organisation, has revised upward its growth forecast for manufacturing for 2018 from 0.9% to 1.1% as a result of the weaker outlook and uncertainty, it has downgraded its forecast for 2019 to just 0.3% from 0.5%. GDP forecasts remain unchanged for 2018 and 2019, both at 1.3%.
Richard Halstead, director of member engagement for EEF in the North, said: “The moderation in manufacturing performance over the course of this year was not unexpected but in the final quarter there are more clouds on the horizon than there have been for some time.
“This should come as no surprise given the significant political uncertainty at home which is why it is essential that there is an agreement for the UK’s withdrawal from the EU as soon as possible.
“If everything that can go right does then business and consumer confidence should hopefully gather some steam next year with improved prospects for growth. That’s the backdrop we’re working to, let’s hope it’s the right one.”