THOUSANDS of British manufacturing jobs will be lost this year due to the worsening economic outlook, the CBI today predicted.
But Scotland may weather the storm and avoid mass job losses because of its strong reliance on exports, according to business leaders.
An estimated 18,000 manufacturing jobs will be lost in the second quarter of the year – mainly in London, the so
uth-east, south-west and east of England – the CBI predicted.
The warning accompanied today's CBI manufacturing regional trends survey, which questioned 466 companies around the UK.
The confidence of manufacturing firms has been "dented" by the economic slowdown, with expectations for output generally gloomy, especially in the south, the CBI said.
Its study showed a mixed regional picture, with companies in Wales bucking the trend by expressing confidence in their business prospects.
In Scotland, businesses said the total volume of orders had increased in the three months to April and that manufacturing outputs had also risen.
Scottish companies forecasted only a mild increase in their exports for the second quarter of the year and did not expect total orders to increase.
David Lonsdale, assistant director of CBI Scotland, said: "Scottish industry is more upbeat compared to firms in many other parts of the UK.
"At the heart of this remarkable resilience – despite tough competition and rising costs – is a strong reliance on exports, and the good news is that export optimism among Scots firms for the year ahead has perked up.
"However, the continued health of the sector cannot be taken for granted, and a supportive environment for business is critical."
Manufacturers across the UK reported sharp rises in costs – driven by more expensive energy and raw materials – and, in many cases, these were the steepest since the early 1990s.
The rise in costs echoed the findings of last week's purchasing managers' index, published by the Chartered Institute of Purchasing and Supply (Cips).
The data from Cips revealed that factory prices were rising at their fastest rate for at least nine years and also highlighted the second-highest rate of raw material inflation on record.
The full article contains 360 words and appears in The Scotsman newspaper.
