The latest Markit/CIPS purchasing managers' index (PMI), which surveys more than 600 businesses, reports that the pace of manufacturing growth hit a 16-year high in November, with factories recruiting at the fastest rate since the PMI began in 1992.
The index now stands at 58, up from 55.4 in October. With an index reading above 50 indicating expansion, British manufacturing seems to be making itself at home in growth territory.
And the record increase in recruitment also backs up expectations that the private sector will be able to replace the 330,000 public sector jobs now expected to be lost over the next four years.
These positive results are timely. It was only on Monday that Chancellor George Osborne said the UK was moving from a debt-based economy to one that invests and exports and part of the upward surge in manufacturing was due to increased demand overseas.
The health of the manufacturing sector also helps to strengthen the UK recovery as we prepare for the increase in VAT in January and the full impact of the cuts announced in October’s Spending Review make themselves felt.
Taken with the construction PMI due today and the services PMI due tomorrow, these results could be a significant indicator of just how firm the UK’s economic footing is as we gear up for the challenges of 2011.
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( 2.9 / 797 )There’s some interesting food for thought today as search engine Yahoo! releases its top ten most searched for topics in the UK over the last year.
The results pretty accurately reflect the rather downbeat tone and economic uncertainty of 2010. Perhaps in hope rather than in expectation, top of the list was lottery, a new entry in Yahoo!’s most searched for chart.
On a more realistic note, second spot was taken by job centre, which moved up one place from 2009 when it was a new entry. Weather, also a new entry, was in third.
In a time of austerity, it’s also good to see there’s room for a spot of celebrity obsession to take our minds off the gloom. Cheryl Cole was in fifth place, shooting up from number eight, while Katie Price held on to her top ten spot, though slipping from last year’s eight place to ninth.
No doubt this is all a bit of fun, and a good opportunity to grab some headlines for Yahoo!, but the results still provide an intriguing insight into the national mindset.
In amongst the light-hearted stuff – Big Brother at number four, for example, TV guide at six and World Cup at seven (although, as we know, football is much more important than life or death) – it’s clear, as Yahoo! says, that we are “a worried nation, concerned about our futures”.
What will prove to be the hot topics in 2011 remains to be seen…although with horoscopes a new entry in the chart at number ten, it seems we are also turning to the stars for a glimpse into the future.
For more information, please visit www.glazers.co.uk
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( 3 / 743 )Taken together, yesterday’s double whammy of the Office for Budget Responsibility’s latest economic and fiscal outlook report and Chancellor George Osborne’s autumn statement delivered a pretty united front.
The message seems to be one of we’re not out of the woods just yet, but we’re heading in the right direction. Or to mix our metaphors: there’s definitely light at the end of the tunnel.
There’s also clear recognition that changes have to be made to make life easier for the private sector businesses that everyone is depending on so heavily to drive the recovery, so Mr Osborne’s plans for consultation on simplifying the corporate tax regime and a cross-government Growth Review designed to identify how barriers that hold back the private sector can be broken down will be welcome.
But the nature of running a business means that those who do so are a hard-headed lot. The coalition government has made making life easier for business a recurrent theme of its administration but six months in, business owners and entrepreneurs might be wondering how much has changed so far.
Many of them may agree with David Frost, Director General of the British Chambers of Commerce when he says: “The review discusses the need to create the right framework for growth, and acknowledges the contribution made by small and medium-sized enterprises. The question remains as to whether government can remove the real barriers that prevent businesses from thriving.”
Mr Frost calls for issues such as planning, access to credit, and burdensome employment legislation to be tackled head on. Only then, he says, will the business community be able to play its part and drive the recovery forward.
The review will start with an intensive programme of work, based on the evidence provided by business, to report by the 2011 Budget. Businesses will no doubt be hoping Mr Osborne will be able to deliver some real barrier-breaking measures on 23 March.
For more information, please visit www.glazers.co.uk
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( 2.9 / 527 )As another working week begins, today’s news agenda promises to give us plenty to think about over the next few days.
In an hour or so, the Office for Budget Responsibility (OBR) will release its latest growth forecasts, which reports suggest are likely to be more upbeat than its last predictions in June. An upgrading from 1.2 per cent to 1.7 per cent is expected by those in the know.
Later this afternoon, Chancellor George Osborne will update MPs – and the rest of the nation – on the health of the economy as he delivers an autumn statement in response to the OBR forecasts.
It’s probably fair to say that we all want the OBR boffins to be there or thereabouts with their forecast and if the reports of what they will say are correct, their tone seems to be one of cautious optimism, taking into account factors such as last month’s initial estimates of a 0.8 per cent growth in the economy between July and September and tax revenues set to exceed expectations by £10 billion.
It’s also quite likely that Mr Osborne’s message will strike a similar note. With the full impact of the Spending Review cuts yet to take their toll, the old saying about many a slip between cup and lip might spring to Mr Osborne’s mind, although there do seem to be signs that the economy is slowly but surely making progress.
Whatever the OBR and Mr Osborne have in store for us, the nation will be hoping that after a lengthy journey through troubled seas, it will now be a case of steady as she goes for the good ship UK Economy.
For more information, please visit www.glazers.co.uk
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( 2.9 / 845 )At a time when many businesses in Britain are still having a difficult time of things, news that firms in one sector have seen a 38 per cent increase in profits in just two months would usually be cause for celebration. But since the firms concerned are the UK’s energy suppliers, these bumper figures have instead resulted in questions about whether consumers are being ripped off.
Energy regulator OFGEM is to review companies’ recent behaviour and has warned it will take action if it finds customers are being treated unfairly.
The companies do not seem to have done themselves any favours with three of the ‘big six’ suppliers announcing price rises in recent months, despite the increase in profits. Of equal concern to consumers is the apparent herd mentality of the industry, with the announcement of price rises by one firm often swiftly followed by similar increases elsewhere.
For businesses and householders, this apparent lack of competition can be frustrating, and the regulator will be under pressure to ensure the market is operating effectively.
When the British energy market was deregulated, there was briefly a period of frantic competition as a large number of new suppliers battled for a slice of the action, but subsequent takeovers and mergers have reduced competition. The regulator’s last major probe into the operation of the market in 2008 found no evidence of anti-competitive behaviour but the firms are likely to find their operations under scrutiny once again.
However, there is no relief for those struggling with high bills this winter. Any review is not likely to be concluded until next Spring, when OFGEM may either take action itself or refer the matter to the government or Competition Commission.
For more information, please visit www.glazers.co.uk
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