Britain's factories are employing new staff at the fastest rate in more than 40 years amid rising orders but manufacturers are increasingly concerned that geopolitical tensions will weigh on business, the CBI said.
Economist Rob Wood described the CBI survey’s results as strong but said rising geopolitical tensions across Europe and the Middle East would see many businesses worry about long term stability.
“The latest escalation of events in Ukraine could knock manufacturer’s confidence further in the next few months as the Putin effect spreads beyond Eastern Europe and Germany,” he said
Of the manufacturing companies surveyed, 33% said staff numbers were higher over the last three months, while 12% said they were down, the highest positive rate since January 1974. This was especially high across the automotive, aerospace, and nuclear sectors.
Economists were positive overall about the report, despite official figures which revealed a surprise drop in production in May. The survey also revealed that while businesses were getting more orders and output was growing, export growth rates were flat.
Business Minister Michael Fallon said of the report: “Britain’s manufacturers are helping drive the UK economic recovery. The Government will continue to work closely … creating more highly-skilled jobs and a stronger economy for everyone.”