The very sluggish economy is wreaking havoc not only in the retail front but also in the manufacturing sector. The economic conditions for factories is deteriorating at a faster rate than expected over the last quarter, based on newly released data.
Based on the Confederation of British Industry’s (CBI) industrial trends survey released today, manufacturers are very much affected in the slowdown in consumer spending that has been plaguing retailers in recent months.
The CBI said orders and output has fallen faster than predicted over the last three months with domestic orders plunging the farthest – falling at their fastest rate in two years.
The unexpected jump in export orders that was posted last July was also not sustained.
In general, about 34% of firms reported a decrease in new orders over the last quarter. But 20 per cent reported an increase in new orders. The balance of minuse 14 per cent is twice the last quarter’s rate of minus seven per cent. Analysts had initially predicted a decline rate of minus two per cent.
With business optimism sliding and weakend investment decisions, employment rates have also taken a hit with the employment rate falling over the last three months.
Based on a separate survey done by the GMB Union, the number of factory workers declined across Britain over the last ten years. The West Midlands has seen the largest drop, with 180,000 workers being affected from a total workforce of 635,000 in 1996.
Company formation and business solutions experts are hoping that the economic climate will improve soon so that the economic decline will be arrested.