As Felicity blogged about yesterday, the manufacturing PMI hit an eight-month high of 54.4 for March 2015, marking two years of expansion. This rounds off a good quarter – a strong domestic market is now being supplemented by modest export growth, the pick-up in orders helped by strengthening activity in much of the eurozone.
So, broadly, official statistics and watched indicators are showing a positive story about the sector. But how are companies feeling?
Quarterly check on business confidence
Our first quarterly Manufacturing Outlook survey of 2015 provides further evidence of growth across manufacturing at the start of this year. All the major indicators - output, employment, investment and orders - were positive in the past three months, remaining above their long-term averages.
New to the survey this year is an economic confidence indicator which monitors expectations for business conditions and overall activity in the UK economy in the next 12 months. On both indicators there are moderate levels of optimism about growth, with marginally higher confidence levels about business performance compared with UK economic prospects.
All regions are, on average, expecting to see an improvement in business conditions and activity in the UK economy over the next twelve months.
That said, there is some variation between regions with manufacturers in the West Midlands and the South West expecting slightly stronger improvements in business conditions in the year ahead than the rest of the country. Respondents in the East Midlands and the North East have below average business growth expectations for the next 12 months.
There is slightly less variation in expectations about economic improvement in the next year. While all regions are forecasting a modest improvement, companies in the North West report the weakest expectations and in general manufactures in the south of the country are less confident about UK growth than those in the north.