Hard times still ahead for U.K. manufacturers
August 28, 2009
The fall in demand both domestically and internationally will see many more manufacturers go out of business this year according to a study by the Centre for Economics and Business Research (CEBR).
Last year saw the failure of 1,600 companies and estimates say this figure will rise 2,460 for 2009. The figure would be the highest since the last recession when in 1991 a total of 3061 businesses in the manufacturing sector closed their doors. The study does point out the fact that in 1991 there were far more businesses in the sector to close.
Manufacturing makes up around 13 percent of the U.K.’s economy.
The figure predicted is based on the fact that many of the companies still in business have been fighting for their lives and although the recession may be coming to and end it has reached a point where many companies simply cannot hold on.
Figures from a manufacturer’s organization say that two thirds of businesses have had to freeze salaries just to survive.
Some hoped that the pounds weakness would have produced an increase in exported goods. However the recession has been global and the U.K.’s main customers have not been spending.
As some predict that we are through the worst of the recession Richard Snook at CEBR points out that: “Business failures, like unemployment, generally lag the recession because businesses hang on as long as they can, but in many cases they run out of money.”
Thanks to www.telegraph.co.uk for the above quotes, for more information on this article please visit their website.
Related Posts
Comments
Advertisement
