WiredGov Newswire (news from other organisations)
CBI - SME manufacturers report slump in activity easing
SME manufacturing output fell at a considerably slower pace in the three months to October, following July’s record decline, according to the latest quarterly CBI SME Trends Survey.
The survey of 285 SME manufacturers reported that total new orders stabilised, following a survey-record pace of decline last quarter. Domestic orders were broadly unchanged, and export orders fell at a more moderate pace.
But while the decline in employment also slowed from the last quarter, the cut in headcount among SME manufacturers remained significant.
Business sentiment was roughly unchanged in the quarter to October, following a slight recovery in July. Export sentiment fell at a similar pace to the previous quarter.
Looking ahead to the next quarter, SME manufacturers expect output to grow at a solid pace. Total new orders are anticipated to pick up slightly, reflecting a slight rise in domestic orders and export orders falling at a more modest pace. Encouragingly, employment is also expected to rise modestly.
While investment intentions for the year ahead remain weak, they have nonetheless improved on the past two quarters. The share of firms citing uncertainty about demand, cash-flow related concerns, and labour shortages as factors to limit capital expenditure also declined considerably from last quarter’s record highs.
Alpesh Paleja, CBI Lead Economist, yesterday said:
“The thaw in activity seems to be melting for SME manufacturers, and it’s encouraging that output and employment is set to grow in the quarter ahead. But a second national lockdown will inevitably mean that prospects are now looking bleaker.
“However, the step up in government support is welcome. In particular, extending the Job Retention Scheme further will give companies the certainty and stability they need to help safeguard jobs. If signs of additional strain are growing among SME manufacturers and their supply chains, the government may need to think about more tailored support in the coming weeks.”
- Output volumes in the three months to October (-15%) fell at a slower pace than in July (-53%, record quick decline). Firms expect output to grow at a solid pace in the next three months (+14%).
- Total new orders in the three months to October were flat (-1%) following a survey record decline last quarter (-56%). Domestic orders were broadly unchanged (+3% from a record sharp decline of -64% in July) and export orders fell at a slower pace than in July (-19% from a record fall of -55%).
- Looking ahead, manufacturers expect total new orders to grow marginally in the next three months (+4%). Domestic orders are anticipated to pick up slightly (+5%), while export orders are expected to fall at a slower pace (-8%).
- Numbers employed in the quarter to October fell strongly (-30%), but at a slower pace than in July (-43%). Firms expect headcounts to pick up somewhat next quarter (+9%).
- Business sentiment in the quarter to October (+1%) was flat following modest growth in July (+9%). Export sentiment fell at a similar pace to last quarter (-24%, from -26%).
- Manufacturers expect investment in buildings (-29%) and plant & machinery (-11%) to decline in the next year, but to a much lesser extent than last quarter. Capital expenditure in product & process innovation is expected to pick up slightly (+6%), while spending on training & retraining (-3%) is anticipated to be broadly unchanged.
- The share of firms citing uncertainty about demand (55% from 75% in July), inadequate net returns (26% from 47%), internal finance shortages (14% from 38% in July), inability to raise external finance (9% from 29% in July), and labour shortages (16% from 33% in July) as factors to limit capital expenditure over the next year declined noticeably from last quarter’s survey record highs.
Latest News from
WiredGov Newswire (news from other organisations)
LGA responds to latest alcohol-specific deaths statistics08/12/2021 13:15:00
Cllr David Fothergill, Chairman of the Local Government Association’s Community Wellbeing Board, responded to the latest ONS figures on alcohol-specific deaths in the UK, which show there was an 18.6 per cent increase in deaths from alcohol-specific causes in 2020 compared with the previous year and was the highest year-on-year increase since records began
LGA responds to Ofsted annual report08/12/2021 12:15:00
Cllr Anntoinette Bramble, Chair of the Local Government Association’s Children and Young People Board, responded to Ofsted’s annual report
Government and business must work together to accelerate economic recovery amidst fierce battle for investment07/12/2021 16:05:00
Following almost two years of Covid-reduced revenues for many important sectors, staff shortages, cost pressures and disruption to supply chains, business is facing renewed uncertainty over the new Omicron variant of Covid.
647,000 festive workers get no statutory sick pay – TUC analysis07/12/2021 15:20:00
New analysis published yesterday (Monday) by the TUC shows that 647,000 workers in hospitality, retail, and arts and entertainment – key sectors for Christmas festivity – do not qualify for statutory sick pay.
Citizens Advice responds to the Consumer Duty announcement07/12/2021 14:40:00
Matthew Upton, Director of Policy at Citizens Advice, responds to the Consumer Duty announcement
LGA responds to extra drug treatment and recovery funding07/12/2021 13:40:00
Cllr David Fothergill, Chairman of the Local Government Association’s Community Wellbeing Board, responded to the publication of the Government’s ten-year Drugs Strategy, which includes almost £780 million extra funding for drug treatment services
Not another divisive referendum07/12/2021 13:33:00
TUC South West Regional Secretary, Nigel Costley, believes now is not the time for a divisive referendum on abolishing Bristol's mayor.
NHS Confederation - Actions taken to mitigate pressures in health and social care07/12/2021 12:40:00
The Welsh NHS Confederation calls on Welsh Government to provide ring-fenced local authority allocations & sustainable, recurrent social care funding.
Booster for business investment needed to sustain the recovery & unleash UK's potential - CBI Economic Forecast07/12/2021 12:15:00
The foundations for the UK’s economic recovery remain firm despite global supply challenges weighing on growth in the near-term, according to the latest CBI economic forecast.