The BBC has reported that UK manufacturing is making more due to growing orders and good domestic demand. While this good news is essentially a short term snapshot, it demonstrates UK’s manufacturing’s ability to drive both its own growth, and the growth of the UK economy.

The Industrial Strategy, the 2 year 100% capital allowances and other measures put in by government to grow the manufacturing sector are long term in their effect. However, this is not to say that these measures cannot also help in the shorter term, as new investment replaces imports and brings on stream new product development.

The BBC story was based on a Markit survey of manufacturers.

The Markit/CIPS Purchasing Managers’ Index rose to 51.3 in May from 50.2 in the previous month. A figure above 50 indicates expansion.

Markit said both production and new orders had picked up, with the domestic market driving demand for new business. The survey also indicated that the manufacturing sector created jobs for the first time in four months. Markit also said that the cost of raw materials had eased somewhat, thanks to weaker commodity prices.

“Although the domestic market was the main impetus to new order inflows, demand from overseas markets at least managed to keep its head above water,” said Markit economist Rob Dobson.

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