UK Covid recovery: Manufacturing sector grows fastest for DECADE after Rishi Sunak says he’s ‘confident’ of recovery
- The closely reviewed industry PMI hit a 10-year high of 58.9 in March
- Anything above 50 in the index represents an increase in economic activity
- Rishi Sunak last night insisted that he is ‘certain’ that the UK can recover strongly
Hopes were sparked that the UK could roar back from the coronavirus today as figures showed the manufacturing sector was growing the fastest in a decade.
The closely examined IHS Markit / CIPS PMI recorded a score of 58.9 – with just over 50 representing expansion.
It was the highest number since February 2011, while the company’s optimism was also at a seven-year high.
The strong showing came after Rishi Sunak insisted he was ‘confident’ the country is well positioned to recover from the brutal impact of the pandemic, with vaccine roll-out fast and restrictions starting to ease.
Yesterday, the ONS released revised GDP data showing that last spring’s downturn was even worse than previously thought – but the economy slumped back faster than estimated.
The closely watched IHS Markit / CIPS PMI index noted a score of 58.9 – with just over 50 representing expansion
The strong showing came after Rishi Sunak insisted that he is ‘confident’ that the country is well placed to recover from the brutal impact of the pandemic.
In the latest PMI survey, production chefs reported strong growth in new production from domestic and overseas customers.
However, rapid growth is putting pressure on supply chains, and logistical problems lead to delays in delivery.
Total manufacturing production also rose for the 10th consecutive month, and at the fastest pace since November last year, including consumer goods production, which had contracted in the past two months.
Bosses reported an increase in orders as non-essential retailers and the hospitality industry prepare to welcome new customers as lockdown restrictions relax.
Some also saw an increase in orders from customers eager to buy inventory now to avoid disappointment from future supply chain disruptions or potentially increased costs.
But supply chain issues have already arrived, respondents said, with Covid-19 restrictions, low supplier inventories, port disruption, post-Brexit issues and resource shortages, all mentioned.
Inflationary problems are also starting to hit the industry – with the additional costs passed on to customers – as output taxes have grown the fastest since January 2017.
All the extra business helped boost employment in the industry, with job growth reaching its highest point in seven years, supported by the strongest rise in job backlogs in 11 years.
Rob Dobson, director at IHS Markit, who is compiling the survey, said: “ The domestic market remained the main source of new orders as companies reported that the roll-out of vaccines and customers’ preparations to ease the lockdown restrictions increase the expansion. supported.
He added: ‘Weak export sales and supply chain issues are likely to remain a barrier to future growth, but with shipping issues already leading to serious disruptions to production schedules, raw material availability and further distribution of finished products to customers, especially overseas. ‘
Duncan Brock, Group Director at the Chartered Institute of Procurement & Supply (CIPS), said: The result of Covid, Brexit and now the Suez delays could potentially push back some of April’s gains. ‘
Yesterday’s revised GDP data shows a 19.5 percent decline in the second quarter of last year, during the first brutal lockdown. But the economy recovered faster than previously estimated
The 9.8 percent revised recession in 2020 was still the worst downturn in 300 years