Official data bringing news that Britain has avoided a triple-dip recession brought sighs of relief all round but the fact that the economy grew by 0.3pc in the first three months of the year owed no thanks to the manufacturing sector.
The rise was better than the 0.1pc growth that economic pundits predicted but it was mostly driven a 0.6pc hike in the all-powerful service industries and produced what one expert called a “skewed upturn”.
Manufacturing output fell by 0.3% while construction output fell by 2.5% as “surveys of manufacturing and construction signaled ongoing downturns in March, with the goods-producing sector seeing the rate of decline gather further momentum”.
Chris Williamson, chief economist at Markit, said: “The worry is that, even if the economy is gaining some momentum, the best we can expect is very meager growth for as long as inflation runs high and the eurozone crisis rolls on,” adding that a continuation of growth in the second quarter was by no means assured and no cause for complacency that the recovery was back on track.
However, Terry Scuoler, Chief Executive of the manufacturers’ organisation EEF, said the data represented “modestly good news” bur urged the government to deliver on commitments to increase investment in infrastructure and increase competition in the banking sector.
This material is protected by copyright Ken Hurst 2012.