Manufacturing output at its best since April

Manufacturing News, Source : The Manufacturer
Published : 16 Jan 2006 9:57

Manufacturers managed to claw back some ground in November, to achieve the best increase in output since April, the monthly figures from the Office for National Statistics (ONS) show. But the more reliable three monthly figures still reflect a downward trend in production.

Between October and November, manufacturing output increased by 0.4 per cent. Ten of the thirteen subsectors showed increases in output and only three showed a decrease. There were two significantly increasing subsectors during November. The transport equipment subsector increased production by 1.3 per cent and the machinery and equipment subsector by 1.5 per cent. There were no significant decreases in output during that same period.

However, the three monthly figures, which are widely accepted as being more representative of overall trends, continued to show a downward slide in output. For the three months to November, manufacturing output decreased by 0.8 per cent compared with the three months to August, with eleven out of the thirteen subsectors showing decreases in output and only two showing increases.

There were significant decreases in the food, drink and tobacco industries, where output decreased by 1.5 per cent and the paper, printing and publishing industries, where output decreased by 1.2 per cent. There were no significant increases on the three-monthly basis.

The overall Index of Production increased by 0.6 per cent between October and November, largely driven by the need for increased energy supply in the onset of winter. Overall energy output increased by 3.8 per cent. Within the energy supply sector the gas supply output increased by a massive 10.4 per cent. November was colder than the long-term average temperature and this increased demand for gas within the UK for heating purposes. In addition to strong UK gas extraction figures, large volumes of gas were also imported from Europe to meet the high demand.

Commenting on the ONS Manufacturing figures, Andy Martin, national director of manufacturing at Barclays, said: “The larger-than-expected monthly increase provides some New Year cheer for the sector. Manufacturers can look forward to more positive times in 2006, if they continue to demonstrate the strong operational and management rigour which they showed during a difficult 2005.”

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