ISO 9001 & UKAS Registered, Electron Beam Services in the United Kingdom ISO 9001 & UKAS Registered, Electron Beam Services in the United Kingdom

There's good news this week (December 16th) for the manufacturing sector in the UK, with those in the industry increasing their pace of production and total order books hitting a 20-month high.

This is according to new research from the Confederation of British Industry (CBI), which has found that growht in output has been the highest since the middle of 2014, with just four out of the 18 sectors seeing a fall in production. Aerospace and mechanical engineering were seen to be the main drivers of this particular growth, with expectations for hikes in production in the first quarter of next year remain solid.

Chief economist with the CBI Rain Newton-Smith said: "After a challenging 2016, UK manufacturers will want to build on the positive momentum going into the new year, with the government's recent commitments on a modern industrial strategy and innovation investment a welcome tonic."

She went on toa dd that while manufacturers are ending the year on something of a high, the weakness of the pound has been driving up the costs of imports and the survey shows that this is likely to feed through to elevated factory gate prices.

In November, CBI director for innovation Tom Thackray noted that supporting and getting behind innovation will be pivotal to the nation's success in the future, adding that research and development spending is still too low. The CBI is now calling for a joint target of three per cent of GDP expenditure to be brought in and there is still plenty of time for the business community and the government to take action in this regard.

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Construction has fallen to a four year low in the UK, with some pointing the finger at Brexit which has shaken confidence in the building industry to its core.

Latest ONS data shows that construction has fallen 1 per cent in the past quarter, following a trend as building has fallen for a number of years. The data is for the three months following the Brexit.

The value of all repair and maintenance was 3.6 per cent lower than in the second quarter of the year, which was partially offset by an increase in all new work of 0.3 per cent, said the ONS.

Despite this fall, there is some happy news in that it was expected to have by a further 1.4 per cent according to analysts prior to the announcement. The ONS has also not changed its forecast for overall economic growth in the third quarter, of 0.5 per cent.

British construction makes up about 6 per cent of the GDP in total.

The news follows the announcement of a £5billion housebuilding stimulus package, including £3billion for 25,000 homes to tackle the housing shortage that has seen house process rise beyond affordable levels for many people.
Communities secretary Sajid Javid will say that addressing the housing shortfall is a "moral duty" and one "that falls on all of us".

Overall, the outlook was not as poor as many official forecasts suggest, according to Reuters, who suggest the UK economy has coped better with the impact of Brexit uncertainty that was first assumed.

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Trade association for the offshore oil and gas industry Oil & Gas UK has just published its latest Decommissioning Insight 2016 report, predicting that a gradual but steady increase in offshore oil and gas decommissioning in both the UK and in Norway will be seen over the coming decade.

The survey, the first to be carried out of decommissioning markets in both nations, confirms that this is a growing market, despite the fact that oil prices are low and continue to challenge the more mature North Sea offshore assets.

In 2015, total decommissioning expenditure across both countries was £2.1 billion, compared to just under £1.6 billion in 2015. The total amount expected to be spent on the UK Continental Shelf (UKCS) between now and 2025 is £17.6 billion, climbing from the £16.9 billion spent for 2015-2024.

Of the estimated £17.6 billion of decommissioning expenditure on the UKCS over the next ten years, more than 50 per cent of this market will be found in the central North Sea.

“The UK’s supply chain will need to focus on developing a high-quality, cost-efficient and competitive decommissioning capacity to make the most of the opportunity and provide a range of goods and services that can not only be deployed in the UK but also exported overseas,” the association’s upstream policy director Mike Tholen said.

Back in September, Oil & Gas UK’s Economic Report 2016 revealed that in the last 18 months the cost of extracting a barrel of either gas or oil from the UKCS has been cut to almost half its cost since 2014, while the industry also demonstrated a ten per cent hike in production.

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The government has said how committed it is to seeing the HS2 high speed high capacity railway line through to completion, with the transport secretary saying that the development will boost jobs and regeneration, and deal with the capacity crisis currently facing the UK’s rail network.

Earlier this week (October 11th), Chris Grayling said that the UK needs this high speed rail network now more than ever, with the country quickly approaching crunch time where capacity is concerned.

“In the last 20 years alone, the number of people travelling on our railways has more than doubled and our rail network is the most intensively used of any in Europe. We need HS2 for the capacity it will bring on the routes between London, the West Midlands, Crewe, Leeds and Manchester as well as the space it’ll create elsewhere on our transport network,” he went on to say.

Construction is set to begin on the network at the start of next year, with the government confirming plans to make £70 million in funding available so as to support road safety between London and the West Midlands, as well as helping local communities.

The government is also yet to make a decision on the route for the rest of Phase Two of HS2 from the West Midlands to Leeds and Manchester. Proposed stations include Manchester Airport and Manchester Piccadilly, as well as Sheffield Meadowhall and stations in Leeds and the East Midlands. It’s expected that an announcement will be made in this regard this autumn.

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A new report commissioned by the Welsh government has found that over 100,000 tonnes of steel will be required between 2017 and 2023 for infrastructure projects and public sector building in the country.

The document observed that the importance of the steel industry to the country as a supplier of products and major employer is well documented, going on to recommend that the use of UK steel be promoted as well as better identifying just where steel is required, the South Wales Argus reports.

Mark Drakeford, Wales’s finance secretary, said: “As a government, we are committed to doing everything we can to secure a long-term and sustainable steel industry here in Wales. The forecast demand for our future steel needs of our infrastructure and construction projects is set out in the report and will be updated every year. It gives Welsh and UK steel suppliers the confidence and evidence there is demand for their product from the public sector in Wales.”

Sadly, however, it has also just been reported that Tata Steel has suffered another loss in the three months leading up to June, falling £360 million into the red when a £370 million loss on the sale of its long products arm in the UK was included.

The sale of Port Talbot was suspended by the company back in July so it could have more time to explore a link-up with ThyssenKrupp, which could potentially help tackle overcapacity in the steel industry across Europe. The British Steel pension scheme is one obstacle to overcome, since it has a £700 million funding deficit.

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