UK manufacturers begin climb out of recession

After two years of unrelieved gloom there is a widespread feeling among manufacturers in UK regions that they have turned the corner putting the worst of the recession behind them.

This was one of the main findings of the latest quarterly Regional Trends Survey, published by the CBI and Business Strategies.

The survey also said that although problems remained, positive output expectations were boosting optimism.

However for Northern Ireland problems remain. The province's overall confidence has continued to decline, alongside the West Midlands, albeit at a much reduced rate.

But, the picture for the next four months is brighter than it has been for over a year with most regions expecting output to increase, led by the North East and the North West, an encouraging turnaround in the two regions that have seen the sharpest falls in the past 15 months. Only in the South West is output expected to continue to decline significantly in the next four months.

In all other regions, the prospect of improved global trading conditions underpinned an upturn in export optimism after a year of widespread and substantial declines. Again however, the picture is mixed, with Northern Ireland and Yorkshire & the Humber expecting orders to fall in the next four months.

Despite a few setbacks, the rise in optimism has come despite output continuing to decline over the last four months in all regions except Wales, where there was no change. The output fall was accompanied by further severe contraction in employment except in the East Midlands, where the fall was very modest.

The East Midlands also escaped the worst of the continuing downward trend in domestic prices, with a more moderate fall than elsewhere.

(MB)