The latest British Furniture Manufacturers (BFM) Economic Review suggests the strong rebound in economic growth shown in Q2 is now waning, with the latest CBI (Confederation of British Industry) consensus forecasting +2.7% growth for Q3.
BFM MD Nick Garratt has examined reports from the CBI and a variety of other sources as part of the association’s monthly report. His summary reveals that the recovery is being impacted by labour and supply shortages, while money from the general public’s purse is being diverted to social activities now pandemic restrictions have been lifted. The report also reveals that the cost for materials and fuel in August 2021 increased by +20.7% YoY.
With the labour market continuing to strengthen and the number of payrolled employees rising above its pre-pandemic level in August, the number of vacancies has exceeded one million for the first time since records began.
Nick says: “Whilst order books for furniture remain strong, we are seeing the signs of consumers opting to spend their money in the entertainment and leisure sectors. Combining this with weakening consumer confidence, these factors may impact order intake in the coming months. With strong order books and problems with output due to labour and material shortages, many businesses are still operating on long lead times, and it will be some months before weakening demand is felt in factories.”
The review is available for members and those with an interest in the furniture sector here.