Record optimism among small manufacturers

Confidence among small manufacturers has reached its highest level since records began in 1988, according to the Confederation of British Industry's (CBI) latest SME Trends Survey.

The survey of 366 small and medium-sized manufacturers found that in Q1 2014, 46% of firms were optimistic about their situation and 10% said that they were less optimistic in the three months to April. This gives a balance of +36%, the highest level on record.

In Q1 2014:

  • 39% of firms saw an increase in total new orders while 19% said they decreased
  • 36% of businesses reported an increase in domestic orders and 18% said they decreased
  • 25% said their export orders had risen and 16% reported a fall
  • 33% said their output had increased while 16% recorded a fall
  • Confidence about future exports rose for the fifth consecutive quarter to a balance of +26%.

Katja Hall, chief policy director at the CBI, said:

"It's very encouraging to see record levels of optimism among small manufacturers, on the back of robust growth in domestic and export orders, and a leap in output levels.

"Hiring is also on the up, and is set to strengthen as we look ahead into 2014.

"As confidence beds in, we need to see more firms exporting their products to high-growth markets across the globe, giving a healthy and sustainable boost to the UK's recovery."

The findings come a week after official data showed the manufacturing sector grew 1.3% in the first quarter of 2014.