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Index of Production experiences quarterly decrease
Index of Production experiences quarterly decrease

Index of Production experiences quarterly decrease

Figures released by the Office for National Statistics (ONS) indicate a varied rate of economic activity across headline industries in April 2017.

We went into detail previously about the fall in construction output in April and the three preceding months, but activity across the headline industries was also mixed.

This covers volume of production for manufacturing, mining and quarrying, energy supply and water and waste management industries.

In the three months to April 2017, the Index of Production (IoP) fell by 1.2%, following high levels in the three months to January.

It reflects a 5.8% reduction in energy supply as well as a 0.7% contraction in manufacturing.

However, when taken measured in the month of April, total production output actually increased by 0.2% when compared with March 2017. This rise has been attributed to increases in energy supply (2.9%) and manufacturing (0.2%).

When assessed against the total production output for the corresponding month of 2016, there has been a 0.8% drop. Continuing the trends shown, energy supply was responsible for the largest downward contribution, due to a 7.4% decrease.

In the three months to April 2017, the pharmaceuticals sector experienced a record drop in output by 11.9%, which had a knock-on effect on manufacturing. This is quite a turnaround. In the three months to January 2017, the output in pharmaceuticals actually increased by 10.1%.

Elsewhere, good news came by way of the fact that transport equipment provided the largest contribution to the manufacturing increase in the month of April. This was followed closely by pharmaceuticals.

Meanwhile, figures charting the IoP for the three months to April 2017 show a 1% increase from the three previous months. Again, manufacturing was a chief reason for this (1.7%) which was largely due to transport equipment.

There were also upwards contributions from the majority of manufacturing industries, which boosted this figure.

However, despite some of the increases reported, it’s fair to say that there is some way to go yet.

Since 2012, both production and manufacturing have increased steadily but, although these levels represent a recovery of sorts, there is still some way to go before both reach the level they were at before the pre-downturn gross domestic product (GDP) peak from the first quarter of 2008.

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