Manufacturers get stronger

Recruitment and investment plans among UK manufacturers are at record levels as the sector maintains strong growth, a study today shows.

The Engineering Employers Federation (EEF) said a survey of more than 500 firms showed that exports were behind "strong" orders, but it added a note of caution about the durability of the economic recovery.

The cost of finance, especially for smaller firms, was preventing demand for goods being translated into a recovery in investment, the report noted.

EEF chief economist Lee Hopley said: "Manufacturers have picked up this year where they left off in 2010, with output growing and little sign that the export-led recovery is about to dry up in the near term.

"However, the outlook for the rest of 2011 still remains uncertain as a number of economic headwinds persist and new geopolitical tensions add another layer of uncertainty to economic forecasts."

Tom Lawton, of BDO LLP, which helped with the research, added: "The data points to price increases among manufacturers, driven in part by underlying movements in the cost of raw materials."