Staff levels up despite fall in trade

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SMALL and medium-sized manufacturers have increased staff numbers in recent months despite a fall in output according to a report published this week.

In the latest quarterly survey by the Confederation of British Industry (CBI), 23 per cent of manufacturers reported output volumes had increased in the three months to July and 28 per cent said they had fallen. The resulting balance of -5 per cent is the first fall since October 2009. However, firms expect output to be broadly flat in the coming quarter (+2 per cent).

Lucy Armstrong, chairman of the CBI’s SME Council, said challenging domestic conditions and continuing uncertainty over the Eurozone were clearly taking their toll on the UK’s smaller manufacturers.

“Nonetheless, smaller manufacturers have stuck by their plans to take on more staff – an increase in numbers employed is perhaps one of the few bright spots in an otherwise muted picture,” she added.

SMEs increased headcount in the quarter to July (+11%), broadly in line with expectations but expect to hold off hiring in the next three months.