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Before Christmas I felt fairly optimistic that we were moving back towards positive territory – and sure enough, Q4 GDP figures confirmed exactly that. All good. The Purchasing Managers’ Index rose to a 15-year high in January. Even better.
So why has the manufacturing and engineering interim market gone rather quiet? A number of interims have reported that despite enquiries picking up in January, there has been a marked decrease in activity over recent weeks.
I would be interested to know from readers if this is more widespread and their thoughts as to the cause for this? Please add your comments.
The view that recruitment bears a very close correlation to client activity would indicate a flat first quarter for GDP, and possibly worse for manufacturing. The marked increase in activity from the Financial and Business Service sectors appear to be fundamental in underpinning the overall recovery, and will I think prevent the much talked about ‘Double Dip.’
Whichever way we look at it, the recovery is very fragile and data remains mixed – surveys announced consumer confidence reaching a two year high whilst spending declined; new care sales rose again, whilst house prices fell.
So where does this leave us?
Certainly in a better place than 12mths ago, the free fall in orders and revenues have stabilised; costs have been slashed via a combination of pay cuts; reduced shifts and redundancy and the figures for the manufacturing payroll have seen a slight rise which bodes well for the longer term.
Ultimately, it’s going to be another tough year – let us hope the IMF comes to the aid of Greece and the election does not result in a hung parliament!
