Dec 2010

Building Strong Foundations for 2011

UK manufacturing experienced an unexpected surge in November to a 16-year high, according to fresh data which indicates that the sector is staging a healthy recovery from the recession.

The strong growth in manufacturing boosted hopes of a revival in the private sector, and comes as separate surveys today suggesting strengthening manufacturing sectors across the eurozone and also in China.

The Markit / CIPS manufacturing Purchasing Managers' Index rose to 58 in November. Any number above 50 signifies growth rather than contraction, and the figure is the highest the index has been since September 1994. The hiring part of the index was particularly strong, showing that manufacturers took on staff at their fastest rate since the survey began 18 years ago.

Of course, the problem still remains that some Southern European countries remain in recession, and - as Europe remains the UK’s largest export market - this may have an impact on growth moving forward, at least until the eurozone stabilises.

In the meantime, it would appear that the manufacturing sector, which comprises almost 13% of the UK’s gross domestic product, is setting out it’s stall for continued growth going into 2011.