UK manufacturing growth remained strong in May, although the sector is still way adrift of its pre-crisis peak and would take until late 2015 to achieve full recovery even at current sharp expansion rates, a survey has shown.
The survey, published yesterday by the Chartered Institute of Purchasing and Supply, signalled the UK manufacturing sector continued to enjoy one of its brightest spells of growth in output and new orders in the 22-year history of the report.
CIPS's headline purchasing managers' index, a composite measure of activity which includes output, new orders, employment, suppliers' delivery times and stocks of goods purchased, edged down from 57.3 in April to 57 in May on a seasonally adjusted basis.
In spite of this dip, it remained well above the level of 50 deemed by CIPS to separate expansion from contraction and thus continued to signal strong growth.
Overall growth in new orders remained strong, although the pace of increase eased marginally.
The survey also signalled growth in new export orders remained solid. Although the rate of increase of new export orders also slowed in May, Samuel Tombs, at consultancy Capital Economics, believed the fact it had eased only marginally showed UK manufacturers were coping well with the strong pound, which weighs on their competitiveness in overseas markets.
CIPS highlighted the fact, amid continuing worries about the degree to which recovery is being fuelled by consumers, that producers of investment goods had seen a particularly marked acceleration in the pace of increase of new orders in May.
Employment in UK manufacturing rose for a 13th consecutive month in May, according to CIPS, although the pace of increase eased to its slowest in four months.
CIPS cited broadly based jobs growth, across both small and medium-sized firms and large companies.
Rob Dobson, senior economist at survey compiler Markit, said: "The revival of UK manufacturing continued in May, as the sector basked in one of its brightest growth spells of the past two decades.
"Manufacturing production is currently expanding at a quarterly rate close to 1.5%, according to the PMI, helping the sector take huge strides towards recouping the output lost during the recession."
However, he added: "With manufacturing still some 7.5% smaller than its pre-crisis peak, even at this current growth rate it would take until late 2015 to achieve full recovery."
Mr Dobson declared that sustaining the rebound and continuing to push towards rebalancing the UK economy towards manufacturing therefore remained critical.
He added: "On those scores, the latest survey provides some real positives."
Seasonally adjusted figures published last month by the Office for National Statistics showed UK manufacturing output had risen by 1.4% in the first quarter of 2014. However, in spite of strong growth in recent months, UK manufacturing output in March was only at the same level as back in June 2011, underlining the protracted nature of the economic recovery.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article