Manufacturing prices soar

May 12 2008

Manufacturing firms have sharply increased the prices of their goods in a bid to tackle the strongest cost pressures for 20 years, according to a new survey today.

The CBI said that despite the difficult climate, new jobs were being created, especially by smaller companies.

Small and medium sized manufacturers were now passing on extra costs to their customers, the poll of 400 organisations showed.

Demand for goods had fallen at home and abroad, adding to the problems facing the sector, said the CBI.

Russel Griggs, of the CBI, said: “The uncertain wider economic climate has resulted in some mixed findings. What is certain is that small and medium sized manufacturers are continuing to feel the impact of higher fuel and raw material costs, and that they are now having to pass these on to customers.

“While the drop in export orders is worrying, particularly for medium-sized firms, there are some more encouraging signs: smaller firms have been quite bullish about taking on extra staff, and some growth in output is forecast for the months to July.”