Capacity

No change to capacity levels has been recorded in comparison with the second quarter of 1996. A slight increase of those working at full capacity has been recorded since the previous quarter. Of those not working at full capacity, 72 per cent cited lack of orders as a restriction on increasing capacity, 29 per cent cited financial reasons and 16 per cent shortage of skilled labour and 8 per cent cited interest rates. Other main reasons given included the change in status of self employed / tax changes, Black Economy / VAT, poor margins on contracts and cash flow restrictions, (Table 6).

Table 6
Percentage of firms operating at full, 3/4 and 1/2 or less capacity, 1988 - 1997.

	Full	3/4	< 1/2
1988	65	24	11
1989	51	29	20
1990	33	30	37
1991	17	29	54
1992	17	31	52
1993	27	27	46
1994	33	30	38
Q1	33	30	38
Q2	27	31	42
Q3	37	31	32
Q4	37	31	32
1995
Q1	38	30	32
Q2	35	32	33
Q3	43	28	29
Q4	39	27	34
1996
Q1	36	31	33
Q2	44	29	27
Q3	50	26	24
Q4	-	-	-
1997
Q1	42	28	30
Q2	44	29	27

Reports from regions

In Northern, Yorkshire and London regions, the percentage of members reported to be working at full capacity has increased. In all regions there have been only marginal decreases in those at full capacity. Overall there has been little change regionally, (Table 7).

Table 7
Percentage of firms operating at full, 3/4 and 1/2 or less capacity by region

	1996 Second Quarter			1997 Second Quarter
	Full	3/4	1/2 or Less	Full	3/4	1/2 or Less
Northern	52	26	22	59	23	18
North West	39	32	29	37	27	36
Yorkshire & Trent	36	33	31	57	27	16
Midlands	49	26	25	45	28	27
Eastern	49	19	32	41	30	29
London	19	38	43	28	35	37
Southern	47	33	20	46	33	21
South West	45	27	28	40	33	27

First posted: 11 January 1999. Last modified: 27 July 1999.