The UK's small and medium sized manufacturers recorded a sharp decline in total new orders and output volume, the latest quarterly SME Trends survey conducted by the Confederation of British Industry showed Tuesday. However, firms expect the pace of fall to moderate slightly over the coming three months.
Of the 484 firms surveyed, 64% said the volume of total new orders decreased in the three months to April, while 13% reported an increase. The resulting balance of firms reporting a decline in total new order volume stood at minus 51%, the lowest since the survey began in 1988.
The April SME Trends Survey was conducted between March 23 and April 7.
On declining new orders, firms reduced their production. Accordingly, a balance of minus 48% registered a fall in output volume in three months to April, another record low.
Job losses continued to accelerate with half of respondents reducing their headcount in the quarter, and 6% taking on staff. The resulting balance of minus 44% is also a survey low.
Russel Griggs, Chairman of the CBI's SME Council said, This survey shows worries about credit and finance are continuing to constrain some firms' plans, but we are hopeful that recent government and monetary measures should see access to credit getting easier in the coming months.
Looking forward, firms see the pace of the decline in orders, output and employment to ease slightly in the coming quarter. As a result, business sentiment fell at a slower rate with a balance of minus 42% versus January's survey low of minus 71%.
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