UK manufacturing growth at three-year high

Will Green is news editor of Supply Management
2 May 2017

UK manufacturing growth rose to a three-year high in April, though suppliers are “struggling to keep up with demand”, according the latest PMI.

The Markit/CIPS UK Manufacturing Purchasing Managers’ Index climbed to 57.3 in April, up from March’s four-month low of 54.2, and against the no-change reading of 50.

Alongside growth in output, new orders and employment, purchases rose at a record rate and suppliers’ delivery times lengthened.

Duncan Brock, director of customer relationships at CIPS, said: “The British manufacturing industry is moving at such a pace that suppliers are struggling to keep up with demand.

“Delivery times for raw materials have increased for the twelfth successive month and there are signs of shortages for both metals and plastics. With input costs rocketing upwards, some manufacturers are beginning to stockpile raw materials to protect against future price rises.

“So long as sterling’s buying power remains weak, however, consumers should prepare themselves for higher prices.”

Firms reported paying higher prices to materials including chemicals, metals and plastics.

Rob Dobson, senior economist at IHS Markit, said: “Although only accounting for 10% of the economy, the upturn in the manufacturing sector represents some welcome good news after the sharp slowing in GDP seen in the first quarter.

“The big question is whether this growth spurt can be maintained, especially given the  backdrop of ongoing market volatility and a number of political headwinds such as elections at home and abroad.”

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