British Manufacturing Rebound Eases Recession Fears

19th June 2023

British manufacturers are continuing to see a rebound in activity in the second quarter of the year, easing fears that the sector could face a significant recession.

A survey published by Make UK showed that the transport and electronic sectors were doing particularly well, reflecting the continued recovery in the aerospace sector with the increase in passenger miles, together with a spate of large orders for new aircraft over the last year.

Air India, for example, announced plans to buy 470 jets from Airbus and Boeing in February amid hot competition from domestic flight provider IndiGo. Airbus makes the wings and fuel systems for its A350 and A320 planes, which were part of the deal, in the UK.

MakeUK said it also recorded strong balances for electronics manufacturers as companies invest in digitalisation and extra capacity to counter labour shortages. The investments are now translating into "consistently strong balances" for the South-East where electronics is the second-largest industrial sector in the region, it said.

However, despite conditions remaining positive, the forecasting suggests a slight contraction for manufacturing in 2023 overall, despite improvements from the significant contraction that Make UK predicted at the end of last year.

James Brougham, senior economist at Make UK, said: "Manufacturers are seeing a gradually improving picture, but the word ‘gradually' is doing a lot of heavy lifting. However, companies are at least seeing a relative period of stability after the political and economic turmoil of the last few years when they have spent most of their time firefighting.

Read the full story at Engineering and Technology