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Tuesday, 21 October 2014

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Industry confidence in Cumbria bucking national trend

Manufacturing industry in Cumbria appears to be holding its own, in contrast to the latest gloomy national figures.

Rob Johnston photo
Rob Johnston

The Office for National Statistics (ONS) reports that factory output in the UK fell by 1.3 per cent in October, far worse than the 0.2 per cent decline analysts had been expecting.

The wider measure of industrial production fell 0.8 per cent, reflecting a record fall in oil extraction although this was partly due to maintenance on North Sea rigs.

The decline adds to the recent flow of disappointing numbers for the UK economy and bodes ill for GDP after a rise of 1.0 per cent in the autumn ended the longest double-dip recession since the 1950s.

The Office for Budget Responsibility last week slashed growth forecasts for the next five years and predicted a borrowing bill some £84bn higher than its last estimate.

Rob Johnston, chief executive of Cumbria Chamber of Commerce, agrees that manufacturers are having a tough time but believes those in Cumbria are doing rather better.

He said: “While we don’t have these [output] statistics at Cumbria level, emerging figures from our latest quarterly economic survey show stable sales and orders over the last three months.

“There is an expectation of a similar position moving forward for more than half of businesses.

“Within the remainder, a good percentage are growing. So the picture here in Cumbria doesn’t appear to be as difficult as nationally.

“As a Chamber we’ve been working hard to pull together a package of support for businesses to help them access the funding and support they need to recover and grow, and the confidence to invest.

“We look forward to seeing the fruits of that as we move into the new year.”

Mr Johnston is less optimistic about the national outlook for the sector.

He added: “The decline in manufacturing in October is much larger than expected and wider industrial production figures are also bleak, with a decline of 0.8 per cent instead of the increase that was anticipated.

“Chambers’ most recent forecast predicts manufacturing output declining by 1.1 per cent in 2012 as a whole but, unless there’s a significant rebound in the November and December figures, the fall could be even larger.

“We shouldn’t focus too much on one month’s figures but it’s clear that manufacturing is facing major obstacles to a sustainable recovery.

“And the effect on confidence, and therefore business and consumer spending, is a real concern as is the potential impact on the UK’s AAA credit rating.”

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