North East manufacturing output falls to three-year low

Private sector activity declined in the North East for the second consecutive month in April, according to new data.

The latest North East PMI research from Lloyds Bank highlighted a ‘sustained’ drop in new orders, which it said led to a reduction in business activity and job cuts across the region.

The data also pointed to increased spare capacity due to falling backlogs.

The Lloyds Bank North East Business Activity Index, which measures the combined output of the manufacturing and service sectors in the region, fell from 49.5 in March to 49.0 – its lowest in more than three years.

Similarly, payroll figures have now fallen every month since January, although the rate of job losses in April softened to its weakest rate of decline in four months.

Lloyds Bank Commercial Banking’s regional director for SME Banking, Leigh Taylor, commented: “Output levels and staffing numbers in the North East private sector were, once again, dragged down by decreases in new business in April.

“Moreover, the North East remained the worst performing of all monitored English regions and Wales.”

Leigh continued: “Input costs decreased at a slower pace, while output charges were lowered to a greater extent, suggesting that discounts were offered in attempts to secure more work in the face of a subdued demand environment.”

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