European markets continue to play a key role for British manufacturing toward the end of this year, with a strong sales performance on the continent counteracting weaker UK demand.
Manufacturers’ organisation the EEF released its survey of final quarter performance, published in conjunction with accountancy and business advisory firm BDO LLP.
The EEF said that conditions in the fourth quarter mean that 2017 will be the first time since the financial crisis that both output and order balances have been positive in every quarter throughout the year.
Government needs to deliver a Brexit that minimises disruption to manufacturers
Tom Lawton, partner and head of manufacturing, BDO
Chief economist Lee Hopley commented: “Stronger global growth has cemented the foundations for growth in manufacturing this year, but the sector’s contribution to the UK economy has been greater than most expected.
“There is some confidence that this momentum will carry into 2018, but as we head towards the Brexit end game we need manufacturing to produce the same trick of broad based growth again next year.”
Tom Lawton, BDO partner and head of manufacturing warned that the strong European and world performance had implications for the current Brexit negotiations.
“The sector’s performance is being driven by increasing demand from around the world, in particular Europe. The task of government is very clear: it needs to deliver a Brexit that minimises disruption to manufacturers – they are the economic engine of the UK economy,” said Lawton.
“It is encouraging for manufacturers to now see further detail of the Government’s long-awaited Industrial Strategy.
“However, it is critical that the Government commits to the strategy over the long term (15 to 20 years), avoiding the disruptions of political cycles and encouraging manufacturers to commit to significant capital investments to boost growth and productivity.”