Following no increase in June or July of 2024, the UK’s GDP grew by 0.2% month over month in August of that year. However, the growth was just 1% in comparison to the GDP in August 2023. During the June–August period of 2024, real GDP increased by 0.2% compared to the May period and by 0.8% annually. The greatest contribution to the increase in consumer-facing services production in August and the three months leading up to August was the retail trade, excluding the motor vehicle and motorcycle industries. After a corrected decline of 0.7% in July 2024, production output increased by 0.5% month over month in August. The three months leading up to August, however, saw no gain. August showed improvement in three of the four major production output sectors. Manufacturing, which had fallen 1.2% in July, contributed the most to the gain, up 1.1% month over month. In August, nine of the 13 manufacturing subsectors saw increases in manufacturing production.
Manufacturing Output
In September, the Manufacturing Outlook Survey’s third-quarter findings were made public. 307 UK manufacturers were included in the study, which was published by Make UK. Just 6% of the enterprises questioned think that GDP will fall in 2024, while 58% think that the change in administration will result in greater economic growth overall in the next year. The UK upgraded its 2025 projection from 0.8% to 1.8% as a result of this. Due to changes made by the Office of National Statistics (ONS), Make UK, a UK manufacturers’ organization, downgraded its manufacturing growth projection from 1.2 per cent in the previous quarter to 0.5 per cent in 2024 and 0.8 per cent in 2025. In 2024 and 2025, GDP is expected to expand by 1.1% and 1.8%, respectively. Accordingly, it is anticipated that the UK textile industry’s manufacturing output will decline by 7.7% and 2.9% in 2024 and 2025, respectively.
Second Quarter Trade
Despite showing an increase above £1.099 billion in June 2024, the UK’s apparel imports in July came to £1.188 billion (~$1.56 billion), down 4.5% from £1.244 billion in July 2023. In the same month, textile imports rose 1.69 percent year over year to £479 million (about $616 million), up from £471 million in June. In the meanwhile, fiber imports surpassed £30 million in June 2024 and reached £35 million, up from £34 million the previous year.
Imports of clothes fell 5.75 per cent to £3.485 billion (about $4.53 billion) during the second quarter, down from £3.698 billion in Q2, FY23. In the first quarter of 2024, £3.278 billion was spent on imports. Fabric imports totalled £1.382 billion for the April–June quarter, while textile fibres reached £107 million against the previous year’s £1.439 billion and £108 million respectively.
In July 2024, exports of textile fabric totaled £222 million, up from £221 million the previous year and £243 million in June 2024; apparel exports totaled £259 million, up from £293 million in July 2023 and £297 million in June 2024; and fibre exports totaled £68 million, up from £50 million. Textile fabric and fibers brought in £712 million and £172 million, respectively, during the quarter, while apparel exports brought in £837 million (£897 million in 2023 and £832 million in Q1, FY24).
Consumer Price Index (CPI)
The UK’s CPI increased 2.2% in the 12 months ending in July 2024, up from 2% in June, according to CPI statistics issued by the ONS in mid-August. Every month, however, the CPI decreased by 0.2% in July as opposed to 0.4% in July 2023. Additionally, the report showed that the core CPI—which does not include energy, food, alcohol, or tobacco—rose 3.3% during the same 12-month period, but decreased from 3.5% in June. The yearly rate of CPI goods improved from (-)1.4% to (-)0.6%. In the meantime, the CPI for apparel and footwear increased by 2.1% in the 12 months ending in July 2024, continuing its upward trend from 1.6% in June.
Employment Situation
In 2024, the UK’s May–July employment and unemployment rates were 74.8% and 4.1%, respectively. Both fell short of projections during the same time frame in 2023. According to the ONS report, the nation’s economic inactivity rate for the same time period was 21.9%, higher than forecasts from the previous year. Between 16 and 64, it declined in every age group. The rise in women’s working hours was a major factor in the period’s 1.06 billion hours of real weekly hours worked, which was also higher than previous year levels. The number of people who had been unemployed for up to 12 months fell below the levels of the prior year. Although it fell throughout the quarter, this figure was still higher than projections for the same period last year. Payroll estimates
Employment Rights Bill
Within 100 days of the new administration taking power following the July elections, the Employment Rights Bill was tabled on October 10, 2024. The law seeks to support economic growth and security for communities, businesses, and workers throughout the United Kingdom. By eliminating the current two-year qualifying time for safeguards against unjust dismissal, the measure made it possible for all employees to start receiving benefits as soon as they start working. In order to properly evaluate an employee’s fit for a position, the government will also provide input on a new statutory probationary term for new recruits in the firms. In order to finally get the labor market flowing again, the focus is on empowering more individuals to change jobs or reenter the workforce.
Among the 28 separate employment reforms included in the bill is the strengthening of the statutory sick pay by eliminating the lower earnings cap for all employees and the waiting time before sick pay begins. In order to make the workplace more suitable with people’s lifestyles, flexible working arrangements will be implemented whenever feasible. It will be necessary for big businesses to close the gender pay gap, help workers go through menopause, and make sure that expectant and new moms are protected from being fired.
Additionally, a new Fair Work Agency will be created, combining the current enforcement agencies. In addition to enforcing rights like holiday pay, the organization will assist companies that seek legal advice. The goal is to retain employees for extended periods of time.
Transition To Net Zero
The Confederation of British Industry (CBI) called on the government to use tax incentives that can encourage investment in high-growth green technology in order to boost confidence in the shift to net zero in its Autumn Budget Submission. The trade group also recommended a Business Tax Roadmap in addition to long-term business rates reform to provide business certainty. The CBI believes that by connecting the carbon pricing systems in the UK and the EU, the government may hasten the shift to Net Zero. By connecting these two systems, carbon leakage would be stopped and the expensive Carbon Border Adjustment Mechanism deployment would be avoided, which would speed up decarbonization while also making the emissions trading market more appealing.It emphasized how important it is to include green tax incentives in a comprehensive plan to support high-growth green technology. An improved green super-deduction, a new Green Innovation Credit, and a ten percent corporation tax rate for green earnings will all help unlock private sector R&D and guarantee that the UK maintains its competitiveness in the global market while it pursues green growth.
Natural Fibres Under Scrutiny
Because of their natural origins, it is widely acknowledged that natural textile fibres used in fashion are more environmentally friendly than synthetic ones. Since they still make up over 70% of all fibres in the environment, they could not be as biodegradable as anticipated, which might have a big impact on ecosystem health. Accordingly, a group of experts called on environmental scholars to pay more attention to the sustainability challenges related to natural textile fibres. Since little is known about the toxicity and environmental effects of natural fibres, they advocated for reforms in the way research on fibre and textile contamination is carried out. Although natural fibres can have their chemical structure changed for textile applications, which slows down biodegradation or increases the risk of chemicals leaking into the environment, most research on microfibers and textile pollution to date has concentrated on plastic or synthetic materials alone. Therefore, excluding natural fibres from studies on fibre pollution leads to the promotion of uninformed sustainability strategies. Investigating possible hazards related to natural fibres’ toxicity, persistence, and chemical load is still required. This will necessitate the integration of knowledge from outside environmental science as well as multidisciplinary academic partnerships, such as those from the fields of forensic science and forensic fibre experts. Due to inconsistent definitions in the research literature, the scientific community must also seek to standardize terminology. According to academics, the standardized terminology will facilitate and increase transparency in the exchange of knowledge.
CPTPP membership
The UK has obtained the sixth and last ratification required to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a significant free trade region that spans five continents, according to a report published in early September. After the UK’s membership was acknowledged by Japan, Singapore, Chile, New Zealand, and Vietnam, Peru became the sixth country to ratify, marking the agreement’s official entry into effect by December 15, 2024. Over 99 percent of the UK’s existing exports to CPTPP nations would be able to go duty-free thanks to participation in the CPTPP, which may increase the country’s economy by almost $2 billion (~$2.63 billion) a year by 2040. The United Kingdom will be in a strong position to influence its future growth by joining this agreement.
Fabric Digitisation Centre
The UK’s first Fabric Digitization Centre (FDC), located in Arts University Bournemouth’s (AUB) Innovation Studio, was opened in August with the goal of meeting the fashion industry’s increasing need for advanced material digitisation and testing services. The cutting-edge facility will greatly improve the caliber of digital resources accessible for 3D design software applications like Browzwear and CLO. The facility hopes to assist the UK’s progress in advanced 3D design technology by offering premium digital textiles. In the same way, the center will use cutting-edge technology to capture surface texture and physical properties in real-life fabrics and turn them into 3D digital fabrics. By lowering waste and improving resource efficiency, the FDC will facilitate and expedite the adoption of sustainable practices by UK fashion companies.
