Survey: UK Manufacturers More Optimistic

LONDON (AP) -- U.K. manufacturers expect business to improve over the next three months as the weaker pound attracts international orders, but still plan to lay off workers, according to a survey released Wednesday.

The Confederation of British Industry's survey of 463 companies found that the percentage of businesses expecting a rise in new orders was five points higher than those expecting a decrease. That was the first positive balance since June 2008.

However, the percentage of firms expecting to lay of employees was 23 points higher than those expecting to hire more. Seventy-six percent of the companies said they were working below capacity in October, compared to 71 percent in July.

Firms were especially seeing a benefit from the weakness of pound; the portion expecting an increase in foreign orders was nine points higher than those expecting a decrease.

"The recovery from the downturn will be protracted and weak," said Ian McCafferty, the CBI's chief economic adviser.

"Investment will remain constrained and unemployment will continue rising. The tight flow of credit to many manufacturers remains a worry, and firms which are unable to get funding to meet orders could see their hopes of recovery stall."

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