BBC NEWS Americas Africa Europe Middle East South Asia Asia Pacific Arabic Spanish Russian Chinese Welsh

 You are in:  Business
Front Page 
UK Politics 
Market Data 
Your Money 
Business Basics 
Talking Point 
In Depth 

Commonwealth Games 2002

BBC Sport

BBC Weather

Tuesday, 12 March, 2002, 12:45 GMT
Pain persists for UK manufacturers
Car production
The output figures were worse than expected
The UK's industrial output continued to fall in January, dragged down by the slump in demand for electrical and optical equipment.

Latest government figures showed manufacturing output was down 0.4% on December's figure, 6.1% lower compared with January 2001.

The wider industrial output figure - which includes the energy and mining sectors - fell 0.5% from the previous month, and was down 5.2% on a year earlier.

The figures were worse than expected, but the Office for National Statistics (ONS) pointed out that manufacturing output would have risen overall if it had not been for the slump in electrical equipment.

Recent surveys of manufacturing firms have suggested the sector could finally be heading out of recession.

The latest study by the Chartered Institute for Purchasing and Supply, released last week, indicated that manufacturing activity was a expanding for the first time in a year.

The manufacturing recession has been offset in the UK by the growing service sector and the continued strength of consumer spending.

Recovery still on track

Output in the electrical and optical equipment sector fell by 6.4% in January from the previous month.

The ONS said if this sector had been stripped out, manufacturing output would have shown a rise of 0.6% in January.

"UK manufacturing output was weaker than expected but only due to a slump in electrical and optical equipment," said Deborah Reed at Bank of America.

"Outside of this output was up and so consistent with [Bank of England] governor [Sir Edward] George's recent more upbeat message about the UK economy."

The British Chambers of Commerce (BCC) agreed that prospects for the manufacturing sector are now improving.

"There are signs that the turnaround may already be underway," said the BCC's chief economist Ian Fletcher.

"It could be that manufacturing is at the lowest ebb and that the only way to go now is up."

See also:

01 Mar 02 | Business
Manufacturing gloom lifts
01 Feb 02 | Business
Signs of hope for UK manufacturers
14 Jan 02 | Business
UK manufacturing slumps again
20 Dec 01 | Business
UK economy set to outperform
03 Jan 02 | Business
'Bumpier ride' ahead for UK economy
06 Aug 01 | Business
Q&A: The manufacturing recession
Internet links:

The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.

E-mail this story to a friend

Links to more Business stories