IBEC welcomes manufacturing sector growth

Latest industrial production figures released today by the Central Statistics Office were welcomed by business groups today.

On an annual basis, production for manufacturing industries for November 2010 was 15.7% higher than in November 2009, the CSO said.

The 'modern' sector, comprising a number of high-technology and chemical sectors, showed an annual increase in production for November 2010 of 21.7%, while an increase of 3.2% was recorded in the “traditional” sector.

Employers’ group IBEC said that the figures show that the manufacturing sector "returned to strong growth in 2010 and will help lead the economic recovery."

“Irish industry has shown itself to be exceptionally flexible and companies have been able to cut costs and improve productivity in response to the crisis. As global demand recovered, the benefits became apparent during 2010,” said IBEC senior economist Reetta Suonperä.

“We estimate that manufacturing output grew by about 7% during 2010 as a whole. From a slow start to the year, growth accelerated to 15.7% in November. Though chemicals and pharmaceuticals have been the two strongest sectors, growing by 31.5% in November, the recovery has spread to other sectors as well.

“Output in the traditional sectors grew by 3.2% in November and has been posting year-on-year growth since May 2010 after a very difficult 2009, when output fell by 14.1%. Some of the sectors that saw particularly steep falls in output during 2009 have returned to very strong growth in 2010 thanks to recovering demand and a weaker exchange rate. For instance, machinery and equipment, rubber and plastic, and basic metals all posted double-digit growth in November.

“The future for Irish industry is bright, but it is crucial that we do not take the foot of the pedal when it comes to improving productivity and reducing the cost of doing business," Ms Suonperä added.

"The only way Ireland can return to strong growth is through continued focus on improving our competitiveness.