UK factories slash jobs and stockpile goods
British factories slashed jobs in February and braced for Brexit by stockpiling goods at the fastest pace seen in any G7 country since records started in the early 1990s, a survey showed.
The IHS Markit/CIPS UK Manufacturing Purchasing Managers’ Index (PMI), a gauge of activity in British industry, fell to 52 points from 52.6 in January.
Although stronger than French and German factory PMIs, IHS Markit said that the boost to British factory output mostly reflected stockpiling and a drive to cut work backlogs in case the country fails to get a transition deal to smooth the shock of Brexit. About 70% of factories cited Brexit as the reason behind the record drive to build up stocks of parts and materials, survey compiler IHS Markit said.
The UK economy slowed sharply in late 2018, hit by a loss of momentum in the global economy as well as Brexit concerns. Economists say the weakness has continued in 2019.
“Official data confirm that [UK] manufacturing is already in recession, and the February PMI offers little evidence that any shortlived boost to output from stock-building is sufficient to claw the sector back into growth territory,” IHS Markit director Rob Dobson said.
