Britain’s manufacturers have experienced a collapse in demand as the impact of the global lockdown due to coronavirus hammers home with a warning that conditions are unlikely to return to anywhere near normal for some time according a new survey published today by Make UK, the manufacturers’ organisation.

Publishing its first Covid 19 Manufacturing Monitor, Make UK also warned that the extent of the fall is likely to mean that the recent Office for Budget Responsibility (OBR) forecast of a 55% fall in manufacturing output in the second quarter is likely to be an underestimate as things stand.

Make UK added that the extent of furloughing within the sector and, the prospect that a significant number of companies will not take staff off furlough until they see orders increase, means the Government will have to consider extending some form of job retention plan beyond the end of June when the current scheme is due to finish.

Make UK Chief Executive, Stephen Phipson, said:

“While many manufacturers continue to operate and supply our food, vital medical equipment and PPE, there is no disguising that for the sector overall these are deeply worrying times. The extent of the collapse in demand is such it means that the recent OBR forecast could be an underestimate unless there is a quite remarkable turnaround which, to be frank, just isn’t going to happen.

“All the indications at the moment indicate that, even if a gradual easing of lockdowns begins soon, the impact of this shock will continue to hit companies and livelihoods for some time to come. As such, Government may need to be flexible with its future support schemes in the same way that industry is going to have to be flexible with its recovery plans. There will be a medium term need for government to support a recapitalisation effort for businesses who will struggle to repay debt incurred during lockdown.”

The survey of 297 companies was carried out between 20 and 27 April.



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