2020.09.2108:26:00UTC+00UK Manufacturers See No Scope For 'V'-Shape Recovery: Make UK/BDO Survey

UK manufacturers downgraded their outlook for next year as they see no evidence of a V-shaped recovery from the coronavirus-driven pandemic, according to a survey conducted by Make UK and business advisory firm BDO released Monday.

Despite improvements in output and orders from record lows, manufacturers reduced their investment plans, the manufacturing outlook survey showed.

The balance on investment intentions fell to -32 percent in the third quarter from -26 percent in the last quarter.

The balance on output improved to -36 percent from -56 percent in the last quarter which was the lowest balance on record in the 30-year survey history.

Meanwhile, the employment balance weakened since the last quarter, falling to -29 percent from -22 percent.

Manufacturing output is forecast to fall by almost 11 percent in 2020, while the outlook for 2021 was lowered by more than a full percentage point to 5.1 percent from 6.2 percent.

GDP is forecast to fall by -8.5 percent this year before recovering by +10.1 percent in 2021.

"Manufacturing has begun to climb away from the abyss that it stared into earlier in the year," Stephen Phipson, Chief Executive at Make UK, said. "But, make no mistake it is going to be a long haul back towards normal trading conditions, with talk of a V shaped recovery nothing more than fanciful."