Slump in manufacturing as wary firms 'conserve funds'

MANUFACTURING has seen a faster fall in output at the beginning of this year as the Chancellor's £40billion tax raid means businesses are “conserving funds”, research suggests.

- By Mauricio Alencar

The sector is crucial to Labour's growth plans as it pushes for a rise in defence and technology.

But research by the Confederation of British Industry shows less is being produced across the country.

Output volumes fell more in the quarter to March than in the three months to February, it found.

The CBI's Industrial Trends Survey said only three out of 17 manufacturing sub-sectors escaped a drop in output.

Defence and aerospace were described as a “pockets of strength” by the CBI's lead economist Ben Jones.