UK manufacturing confidence slides to 16-month low
UK manufacturing confidence fell to a 16-month low in October having fallen for a fourth consecutive month, according to a report published today by accountancy firm BDO.
Manufacturing confidence fell to its lowest level since June 2017 according to BDO’s business trends report, falling 1.82 points to 106.66, while manufacturing business output slipped from 103.26 to 102.74.
The report said manufacturing is suffering from a general slowdown in global trade, as well as Brexit-related fears of supply chains collapsing in the event a deal cannot be reached meaning European customers are hesitant to buy components from the UK.
Business confidence and output both fell in October, the report said.
Output growth in the services sector, which represents roughly 80 per cent of the UK economy, stayed flat from the previous month, but growth was down year-on-year with optimism in the sector on a gentle downward slope since July.
BDO corporate finance partner Peter Hemington said: “A lack of clarity on the shape of Britain’s future trading relationships has caused a general weakening of business optimism, but it is particularly concerning to see confidence in the manufacturing sector – which accounts for eight per cent of all jobs in the UK – descend to a 16-month low.
“The chancellor’s recent budget announcement to increase the annual investment allowance for two years will go some way to supporting small to medium sized businesses kick-start spending on fixed assets. However, finalising Brexit negotiations is the single most important action required to restore confidence in the British economy.”