The latest for UK manufacturingJuly 27, 2023
Right now, the UK manufacturing industry is facing a challenging period. Following a year which has already seen a drop in the demand for its output, the sector is now seeing a new six-month low point.Low demand leads to recessionary conditions
Indeed, the situation has reached the point that the sector is now facing recessionary conditions. A score above 50 in the S&P Global/CIPS UK Manufacturing PMI survey indicates that a sector is growing, while conversely a score below 50 shows that it is in a state of contraction. And June of this year saw the UK manufacturing sector earn a score of just 46.5, down again from its score of 47.1 just a month earlier.
The reason for the decline has been attributed to a lack of demand for UK manufacturing services, both within the UK and abroad. Indeed, orders for key export markets such as the USA, China, Brazil, and Europe have been dropping over the last seventeen months and have now hit an all-new low. New orders have become scarce on the ground, whilst even established customers have proved wary about signing up to new contracts with UK firms.
Yet UK manufacturing companies still have plenty to offer, with specialists such as https://www.cotswold-machinery-sales.co.uk/roscamat-tapping-machines/electric-tapping-machines/roscamat-tiger-electric-tapping-machine providing high-quality machines, including versatile electric tapping machines.
Big challenges for UK manufacturing businesses
Now, faced with this challenging economic climate, businesses operating in the UK manufacturing sector are faced with some hard decisions. Costs must be cut in order to weather the storm. This could lead to a downturn in purchasing, as well as some redundancies being made, and fewer new jobs being created.
Yet there have been some positive outcomes from the situation too. The reduction in demand has meant that the input costs for producers have also dropped and are now at their lowest point since 2016. Furthermore, the decline in new business has allowed firms to clear their backlog of orders, with the waiting times across the supply chain being cut likewise. This has resulted in a boost in efficiency.