Speculation about the knock-on effects of Brexit, both positive and negative, has been rife and, whilst it’s still early days, it would appear that UK manufacturing has taken a hit.
According to the latest quarterly CBI Industrial Trends survey, expectations for total new orders growth are at their lowest since January 2012, output growth is set to ease and headcount expected to fall slightly. It’s also reported that optimism among manufacturers has dropped to its lowest level since January 2009 in the past three months.
Job cuts have been predicted by factory bosses who are expecting activity to ease in the next three months.
Rain Newton-Smith, CBI Chief Economist, said:
“Manufacturers picked up the pace over the second quarter, with output growing solidly. We’re also seeing encouraging signs of a boost to export competitiveness from a weaker sterling.
“But it’s clear that a cloud of uncertainty is hovering over industry, post-Brexit. We see this in weak expectations for new orders, a sharp fall in optimism and a scaling back of investment plans.
“So, it’s important now for the new Government to steady the ship with a plan, and a clear timetable, for negotiating the UK’s relationship with the EU. This, along with a renewed focus on industrial strategy, will help give firms the confidence they need to grow and create jobs.
“Manufacturers look forward to working with the new Government to preserve the openness of the UK’s economy to markets, skills and trade.”
The CBI’s survey showed just 5 per cent of manufacturers were more optimistic about the business environment than three months ago, compared with 52 per cent that were less optimistic.