Make UK/BDO survey highlights improvements but ‘zero sign’ of v-shaped recovery
14 Dec 2020
Britain’s manufacturers are showing signs of growth from the historic lows experienced by firms earlier in this year, suggests a new survey by Make UK and consultancy BDO.
However, the report warns of a ‘darkening outlook’ for exports ahead of the final departure of the UK from the EU, while investment intentions remain substantially negative for the third quarter in a row.
Make UK chief executive Stephen Phipson suggested this is likely to worsen in the event of the political turmoil that no deal will create.
“Make no mistake, it is going to be a long haul back, with talk of a V-shaped recovery nothing more than fanciful. Having endured over four years of political uncertainty, combined with the pandemic many in industry are feeling like an exhausted boxer in the final round of a bout, with a ‘no deal’ exit from the EU potentially landing a knockout blow,” he warned.
“Should this happen the nascent recovery is likely to go into reverse, with significant damage to manufacturing and job losses following in already hard hit areas and sectors. It is essential that the first step towards a fuller recovery is provided by a comprehensive tariff and, quota free, trade agreement with the EU’ with a sensible range of easements to allow business some time to adapt”
BDO head of manufacturing Richard Austin added that firms that rely on continental supply chains and export markets faced a race against the clock to prepare for the end of the transition period. The prolonged negotiations with the EU have made this far more difficult than it should have been.”
On the positive side, the balance on output improved to -5% which, to give some perspective, far better than the -36% and -56% recorded in the previous two quarters.
