Is the UK’s electronics sector still waiting for the economy to recover?
1 min read
The phrase 'It's the economy, stupid' came to prominence during Bill Clinton's campaign to become president of the US. It's since been adapted - using a 'fill in the gap' approach - to address a range of issues.
For many UK companies, the last few years have not been good for that very reason. There are signs that things are picking up, though.
Unemployment is dropping, albeit slowly, and the Bank of England is beginning to think about increasing interest rates - but not quite yet. Here's an interesting statistic: journeys by 'white van men' have risen by 5.1% in the last three months, suggesting there's more business around.
But what about the electronics industry? The latest figures from DMASS - which monitors sales of semiconductors to industrial customers across Europe - describe the UK as a 'weak spot'. Sales in Q3 were said to be 7.8% less than in Q2, while sales for the first nine months of the year are down between 4 and 5%, compared to -0.3% for Europe as a whole.
IDEA - the International Distributors of Electronics Association - agrees with DMASS about Q3, noting UK semiconductor sales are down by 8.4% over Q2, but it sees an 8.6% increase on year-to-date sales compared to 2012. Pay your money; take your choice.
Should we be concerned? Possibly. UK contract manufacturers see their businesses growing strongly - which implies higher component sales - so either 'traditional' manufacturers are offshoring more, which goes against current thinking, or they are making less, which suggests the recovery hasn't quite made it to the electronics sector.
