Britain’s manufacturers suffer worst drop in output and employment since records began nearly 30 years ago – outstripping the figures seen during the global financial crisis
- IHS Markit/CIPS purchasing managers’ index fell to a record low of 32.6 in April
- Prime Minister Boris Johnson has vowed to get the country’s economy moving
- The reading is worse than the previous record low of 34.5 recorded in 2009
The coronavirus pandemic has caused ‘substantial’ chaos and disruption across Britain’s manufacturing sector, new findings warn.
As the economic toll of lockdown starts to rear its ugly head, employment, new orders and output in the sector fell at the fastest pace for 28 years last month.
The closely-watched IHS Markit/CIPS purchasing managers’ index fell to a record low of 32.6 in April, down from 47.8 in March, with a reading of 50 or above indicating growth.
Dire: The coronavirus pandemic has caused ‘substantial’ chaos and disruption across Britain’s manufacturing sector
April’s manufacturing PMI reading of 32.6 is even worse than the previous record low of 34.5 recorded during the heat of the global financial crisis in 2009.
Prime Minister Boris Johnson is under pressure to get the economy moving again and last night confirmed that he will outline more detailed plans for lifting lockdown restrictions next week.
While the service sector, encompassing hotels and restaurants, has potentially been hit the hardest during the crisis, many factories and warehouses making products for use here in Britain and overseas have been forced to shut to comply with lockdown restrictions.
Separate findings from trade body Made UK today reveal that 80 per cent of manufacturers reported a collapse in orders due to the pandemic last month.
Manufacturing production, new orders and employment all fell and those businesses still placing orders have lengthened lead times dramatically, with most factories staying shut for the entire month, IHS Markit said.
IHS Markit branded the data ‘ruinous for Britain’s manufacturers as they continue to feel the full force of the coronavirus lockdown. Factory and office closures, stalling omestic and international demand and widespread furloughing are all taking their toll on the sector.
Rob Dobson, a director at IHS Markit, said: ‘UK manufacturing suffered its worst month in recent history in April, as output, orders books and employment all fell at rates far surpassing anything seen in the PMI survey’s 28-year history.
‘Huge swathes of industry were hit hard by company closures, weak global demand, lockdowns and social distancing measures in response to Covid-19. The only pockets of growth were seen at firms making medical and food products.’
Exports were also at record lows, with the Covid-19 pandemic also hitting overseas markets, the survey said.
Speaking to managers between 7 April and 27 April, the compilers also found that orders fell across the consumer, intermediate and investment goods sub-industries categories.
Duncan Brock, group director at the Chartered Institute of Procurement & Supply, said: ‘There is no comparable time in history to make predictions against, but, as production ramps up again in the Far East, the sector remained optimistic that, in a year’s time, the operating environment will resemble some new normality.’