British manufacturers, spurred by the rapid rise in new orders, have stepped up their hiring and investment plans as the economic recovery from the COVID-19 pandemic sets in, an industry survey found on Monday.
Trade body Make UK and accountants BDO said their quarterly gauge of manufacturing output has grown at the fastest rate since the series began 30 years ago, in line with other business surveys that show an accelerating economic recovery.
While this reflects an ‘elastic’ effect following the lowest readings recorded last year, the strength of the recovery persuaded Make UK to increase its manufacturing growth forecast for 2021 to 7.8% from 3, 9% previously.
âGrowth in the manufacturing industry is now accelerating as restrictions have been relaxed and economies around the world have started to open up,â said Fhaheen Khan, senior economist at Make UK.
âLooking ahead, there doesn’t seem to be any reason to believe this won’t continue, assuming the chains come off firmly in the second half of the year,â he added.
Official data last week showed UK manufacturing output in April remained 2.4% below its pre-pandemic level. Make UK estimated that it would take until the end of 2022 to return to this level, less time than it had previously thought.
The survey’s investment intentions gauge showed growth for the first time since early 2020.
“It appears that the government’s introduction of the temporary super-tax deduction has provided manufacturers with the incentives necessary to move their investment plans forward,” said Richard Austin, chief manufacturing officer at BDO.
The survey of 276 companies was carried out between May 5 and May 26.
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