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Business Monitor for July 2017
(90 responses, 63% exporters)

Comments on July Monitor Data

This month it is particularly important to note: The Monitor records only the number/share of companies, not the size of orders or number of jobs etc.

Summary

  • Over the summer (July and August) the Monitor's returns often reflect big changes as some firms shut down for a vacation period, while other run their business on a skeleton roster.
  • So during these two months it's important to compare the results with previous years, especially on the running averages.
  • Without exception, this year's running averages for the three months up to and including July are better than the last two years. Mostly markedly so.
  • What is quite exciting is that according to these returns, enquiry levels remain strong, not just as running averages, but also on the straightforward month-on-month comparisons.
  • Yet again the good news isn't evenly spread. The core manufacturing machinery makers aren't having as good a time of it as the subcontractors or those supplying into sectors that ultimately serve consumers.
  • Nearly 40% of companies say they are developing projects, but not investing at the moment.

Statistical commentary

Enquiries:

  • These lead indicators continue well ahead of previous years on three-month running averages as well as on a single monthly basis.
  • Interestingly the Downers' share remains small for exporters, but has doubled on UK business.
  • Overall the three-month running averages compared with the last two years are:
    • 2017 average balances                   UK +23             Export +25
    • 2016 average balances                   UK +0                Export +5
    • 2015 average balances                   UK +14              Export +14

Orders:

  • JAs expected July order numbers are much lighter, with UK business just remaining in positive territory while exporters' balances turn negative.
  • Yet again, performances across different subsectors vary considerably with mainstream machinery manufacturers reporting bigger reductions than contractor sectors and those supplying into consumer related customers.
  • Nonetheless business over the three-month running averages remains very positive and well ahead of 2016 and '15
    • 2017 average balances                   UK +18           Export +18
    • 2016 average balances                   UK -3              Export -5
    • 2015 average balances                   UK +9             Export +4

Jobs:

  • Similarly this running average is now +30, more than double last year's score (+13) and is pretty evenly spread across most participants.

Investment:

  • The share of companies reporting "investing in all areas" falls back again but still represents over a third of all companies reporting, while yet again the three-month running average is 49% well ahead of last year's 26% and just ahead of 2015's strong average of 45%.
  • It is worth noting that almost two in five firms (38%) say that they are developing projects but not committing to them, reflecting how current uncertainties are playing on some companies' plans.

Finance:

  • There's a small weakening on the access to finance numbers, basically indicating no change.

Confidence:

  • This month's numbers are down a little, again basically reflecting no change, with the three-month running average (+19) compared with last year (-5).

The Monitor (Click graphs for larger image and data)


Notes:

  • choice of statements in full:
    1. Developing projects but not committing to them
    2. Investing in all areas of the business

 

Access to Finance

Monthly Changes in Confidence