Manufacturing Outlook: Regional Focus

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On Monday we published our Manufacturing Outlook survey, which showed that trading conditions have become tougher for manufacturers in the last three months, as global economy uncertainty continues to depress output and orders. As Lee pointed out on Monday, output and orders balances hit their lowest levels since the 2008/09 recession.

There is a similar picture across UK regions: compared with last quarter's survey, manufacturers in all regions have reported weaker output balances. This is most notable in the South West and North East, where output balances have swung into firmly negative territory. In the South West, however, this was in line with expectations reported last quarter.

The East of England was the strongest region, for the second quarter running, and saw only a moderate decline in its output balance, which edged down from 41% to 35%.

As with the national figures, manufacturers in all regions expect to see growth in the next quarter. All regions reported positive expectations for output and orders growth in the next three months.

Since the 08/09 recession ended, most manufacturers have seen export orders outperform domestic orders, but manufacturers' expectations for the months ahead are now quite mixed. For example, in the South West companies remain positive about export orders, but expect UK orders to fall while in the West Midlands companies expect UK orders to grow, and expects export orders to fall.

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