Manufacturing report shows contraction ahead of election

The latest IHS Markit CIPS UK Manufacturing Performance Market Indicator Report displayed a manufacturing output figure that measured below neutral for the seventh month in a row in November.

Specifically, the Manufacturing Report revealed a figure of 48.9 for the month of November, down from 49.6 in October, that is still below the neutral figure of 50.0, indicting a consistent contraction of the British manufacturing sector and a subsequent scale back in production as well as job loss.

Professional overseers of the manufacturing sector have attributed this recent turn down to the further delays of Brexit in addition to the uncertainty cast by an upcoming general election in December, with this being evidenced by a decline in export orders reaching its steepest rate in the past seven years.

The Director at IHS Markit, Rob Dobson stated: “November saw UK manufacturers squeezed between a rock and hard place, as the uncertainty created by a further delay to Brexit was accompanied by growing paralysis ahead of the forthcoming general election.

“Downturns in output and new orders continued amid a renewed contraction in exports. The pace of job losses also hit a seven-year high as firms sought to reduce overheads in the face of falling sales.

“Manufacturers across all sectors will be hoping that the New Year brings clarity on the political, trade and economic fronts, providing a more certain foundation to plan and rebuild as the next decade begins.”

The Group Director at the Chartered Institute of Procurement and Supply, Duncan Brock added: “A heavy sense of inevitability hung around the sector in November as it continued to suffer the effects of a lethal cocktail of Brexit uncertainty, slowing global growth, and an impending General Election. These combined to stifle any chance of manufacturing crawling out of the contraction zone, where the sector was stuck for a seventh month in a row.

“Supply chain managers cited weakened domestic demand and one of the biggest falls in export orders for seven years as companies unravelled their pre-Brexit stocks and resulting in one of steepest reductions in purchasing since 2013.

“With this backdrop of pressures, the sector’s performance is unlikely to change any time soon, which means a bleak beginning for the industry in 2020.”

If you would like to read more articles like this then please click here.

The post Manufacturing report shows contraction ahead of election appeared first on UK Construction Online.