80 per cent of UK factories planning to increase prices

From an economic point of view – the news keeps getting worse. A regular survey by the Confederation of British Industry found that UK factories are now planning to raise prices faster than at any point since at least 1975.

Four in five manufacturers expect to increase prices in the next three months, the highest reading since the business lobby began asking the question 47 years ago.

Given global inflation on just about everything – factories are facing a barrage of cost pressures, from higher energy and commodity prices to jobs shortages that are driving up staff wages. They are now passing the burden onto consumers, leading the Bank of England to warn that inflation could breach 10% for the first time since 1982 later this year.

“The cost pressures facing manufacturers have been amplified by the conflict in Ukraine,” said Anna Leach, deputy chief economist at the CBI.

However, there is some good news. Despite these pricing concerns, manufacturing is enjoying pretty decent growth. Output volumes grew strongly in the three months to March, with a net balance of 30% of firms expecting further growth in the next three months.

Records set in November 2021 have been matched, with export orders well above normal, the CBI said. Output increased in 10 out of 17 sectors, led by motor vehicles and chemicals.

The group interviewed the managers of 229 factories and manufacturers for its March industrial trends survey.

 

 

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