Manufacturing output rises year-on-year

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Total production output is estimated to have increased by 1.3% in January 2015 compared with January 2014. There were increases in two of the four main sectors, with manufacturing output the largest contributor, increasing by 1.9%.

There were increases in eight of the 13 manufacturing sub-sectors compared with a year ago and the largest contributor was the manufacture of transport equipment, increasing by 6.1%.

Total production output decreased by 0.1% in January 2015 compared with December 2014. There were increases in two of the main sectors, with mining and quarrying output being the largest contributor, increasing by 2%.

Manufacturing output decreased by 0.5% in January 2015 compared with December 2014. The main components contributing to this decrease were the manufacture of computer, electronic and optical products; the manufacture of machinery & equipment not elsewhere classified; and the manufacture of food, beverages and tobacco.

In the three months to January 2015, production and manufacturing were 10.4% and 4.8% respectively below their figures reached in the pre-downturn GDP peak in Q1 2008.

Lee Hopley (pictured), chief economist at EEF, the manufacturers' organisation, said: "The fall shouldn't be of concern, as other business surveys point to positive underlying momentum in manufacturing. However, there is a strong degree of sectoral divergence which is very much an oil and gas story.

"Whereas those sectors in the supply chain – such as mechanical and electrical equipment sectors – have seen output fall as investment projects have been cancelled or postponed. Those which use oil products as an input to production such as chemicals and rubber and plastics have enjoyed a boost.

"Overall we're still expecting robust growth in manufacturing this year as global uncertainty levels out and expectations among most manufacturers remain strong."

EEF is projecting 1.7% growth this year in manufacturing.