News

The findings show that while the economic environment has been somewhat turbulent, the region’s manufacturers have still put in a good performance in the first quarter of the year with a net 18% reporting increased output and 5% saying the same of investment.

There was also good news for employment, with a net 22% of the region’s manufacturers on the recruitment trail during the first quarter of the year. 

The region’s results contrast sharply with those of other areas such as the North East and North West where the fall in the oil price – hailed as a boon for consumers, but a negative for manufacturers in the oil and gas supply chain – looks to have had an impact on orders. This highlights the more challenging domestic demand environment faced by those with a high exposure to delayed or cancelled investments in the North Sea.

The buoyancy in the South West continues with manufacturers expecting surges in output and orders in the coming quarter. And, looking ahead to the rest of the year, the region’s manufacturers are amongst the most confident, with the region coming second only to the West Midlands in the confidence stakes. 

Nationally, EEF is continuing to forecast healthy growth at 1.7% this year, revised down slightly from 2% last quarter. GDP is expected to increase by 2.8% in 2015, a slight upward revision from 2.6% last quarter.

Other key findings across the UK are:

> Output and orders are positive and in line with expectations

> Domestic demand dips, but there are signs that export growth has returned

> Manufacturers are confident for prospects and UK economy in year ahead

> Recruitment and investment intentions remain strong.

Phil Brownsord, South West Region Director at EEF, says: 

“Any concerns that manufacturing activity might wobble at the start of 2015 have been quashed. These findings show that output, investment and employment all headed in the right direction, with only orders remaining flat, which is a good indication of the confidence companies feel. 

“Having made such a great start to the year, the South West is brimming with confidence, coming second only to the West Midlands. The good news is that this solid start looks set to continue. While confidence levels overall are holding firm, policies to sustain positive investment plans, encourage exporters and improve access to skills remain the order of the day.”

Richard May, partner and Head of the Manufacturing Sector at DLA Piper, says:

"As a global law firm, it is particularly pleasing for us to see new export orders growing alongside a generally positive outlook for the British manufacturing sector with companies still intending to recruit and invest.  It will be interesting to see what impact the result of the UK general election has on the outlook for South West manufacturers in the next quarterly EEF/DLA Piper survey."