Industry analysts predict recession for m&e firms

The analysis, which was published in full on 1 May, has drawn on the latest figures for each of the UK’s top 600 m&e companies.

The headline findings are stark:

• More than one-third of firms are showing signs of recessionary behaviour by reporting declining sales.
• More than half have seen their margins fall. A quarter of these are actually now running at a loss.
• Almost one-third have seen an increase in their need for short-term finance.
• As many as one in 10 m&e contracting businesses could disappear entirely if this trend continues.

David Pattison, senior analyst at Plimsoll, said: “We are reading every day how the credit market and the world of finance is being hit, but nonetheless I was still surprised to see just how much the m&e contracting market is feeling the pressure.

“I hope this report is recognised as an early warning, and managers read this and use the findings to steer a course through these tricky times.”

On the up side, the report found that small firms, which concentrate on local and domestic markets, are less exposed to the slowdown.