Growth fears after factory output slides during April

● Manufacturing slump is blow to GDP recovery hope ● Comes as trade deficit in goods widens in April

Britain’smanufacturingsector suffered its sharpest decline in output in five and a half years during April, official figures yesterday revealed, raising questions over the nation’s growth prospects for the second quarter.

The Office for National Statistics (ONS) said output fell by 1.4 per cent month-on-month, marking the steepest decline since October 2012. The result was well below economists’ expectations of 0.3 per cent growth.

As a result, overall industrial production, which also includes things like energy output, fell by 0.8 per cent during the month.

The decline is likely to raise fresh concerns that Britain’s decision to exit the European Union is weighing on growth.

In the first three months of the year, quarterly economic growth slowed to a mere 0.1 per cent with many blaming a long winter. Manufacturing output accounts for some 10 per cent of the UK economy.

Howard Archer, chief economic adviser to the EY Item Club, said: “A miserable and thoroughly worrying set of UK data that fan concerns over the UK economy.

“While March’s poor performance had clearly been influenced markedly by the severe weather, there are few mitigating factors for a slump in UK manufacturing output in April, a tepid rise in construction output and a sharply widened trade deficit as exports nosedived.

“We have been expecting UK GDP growth to improve to 0.4 per cent quarter-on-quarter in the second quarter, but the April industrial production, construction output and trade data make this look hugely optimistic.”

Head of national accounts at the ONS, Rob Kent-smith, said: “Manufacturing fell in the three months to April with electrical machinery and steel for infrastructure projects seeing reduced production. International demand continued to slow and the domestic market remained subdued.”

Construction bounced back slightly in April following three consecutive months of contraction, nudging up 0.5 per cent, month-on-month.

But on a three-month basis to April, construction output fell by 3.4 per cent – the biggest fall since August 2012.

“While construction output saw a small bounce-back in April after a poor start to the year, over the longer term this sector continues to contract with significant falls across most types of work.

“Construction orders fell for a second successive quarter after recent boosts from large rail projects. However, new housing orders reached their highest level since before the economic downturn,” Kentsmith added.

Separate figures showed that the UK’S trade in goods deficit widened to £14 billion from £9.24bn a year ago and £12bn in March. The figure was the biggest since September 2016.