Sector ups and downs

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Manufacturing didn't have a great November according to the official production data today, but growth over the course of the second half of the year left production levels 2.8% higher than a year previous and at their highest since July 2012.

An uneven sector performance has been a theme of the past couple of years across manufacturing and this continuing trend was also evident in today's data. Compared with a year ago:

  • Transport output was up 12%, chemicals up 3.2% and basic metals up 2.6%.
  • Mechanical and electronics output was down 6.9% and 6.4% respectively.

Expectations level up

Looking at the prospects for the year ahead, increased optimism is more evenly shared across the manufacturers responding to our Executive Survey.

At the start of 2013 manufacturers were expecting output to be flat (a prediction which looks spot on), and the only sectors expecting to see some growth were rubber & chemicals and transport.

For 2014 there is considerably less variation in growth expectations with all sectors, on balance, positive for the first time in our survey.

Industry growth expectations1=significant decline, 5=significant growthSource: Executive Survey

Recovery still has a way to go for some sectors

A more positive outlook across all manufacturing sectors in our survey is particularly welcome given the gap between current and pre-recession production levels in some parts of industry. Only a handful of sectors have now made up the ground lost during 2008 and 2009 (other transport is excluded as output did not fall during this period.) We expect food, metals and machinery to have fully recovered by the end of 2015, but for others such rubber and plastics and electronics that looks a very long way off.

Not gaining ground% difference between current and pre-recession outputSource: National Statistics

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