Exports show marked improvement in 2006, but growth expected to slow

Manufacturing enjoyed a marked improvement in 2006—with increased output, productivity, and exports—although growth is set to slow in 2007, says a new report out of The Engineering Employers Federation (EEF). Productivity is said to have outpaced the rest of the economy; exports hit an eight-year high; and two out of five companies increased spending on skills and training.

Output grew by 1.8 percent in the first nine months of the year, but companies face increased costs in 2007 coupled with the need to improve workers' skills.

Concludes EEF Director-General Martin Temple, "Manufacturing posted a strong set of figures for the last year, with exports expanding strongly despite the strength of the pound. Increased investment in skills and innovation, together with vigorous efforts to cut costs, has made manufacturing much more resilient. Whilst signs from the world economy suggest 2007 may prove to be a more difficult year, manufacturers are better placed to weather any of the storms they may face."