Chapter 4. Britain's Prospects for 1961

It is not likely that insufficient industrial capacity would by itself prevent an appreciable rise in production this year. Table 26 sums up the results of the Institute's annual enquiry into this question. At the end of last year there was of course much more spare capacity in the vehicles industry than a year earlier; but the figures also show much less spare capacity in general engineering, as a consequence of the boom in output in capital goods (page 8). Capital goods producers, however, have more freedom to subcontract than industries which are tied to a production line; the enquiry showed that a number of makers of steel plant and machine tools, for instance, were already increasing capacity by sub-contracting. Subcontractors to the consumer durables and motor car trades can often switch to capital goods trades. Nevertheless, since manufacturers are planning to continue the rapid rise in their investment, delivery delays of some capital goods may lengthen and imports of plant and machinery may increase rapidly.No important raw materials shortages were reported in the enquiry. Steel should be plentiful again in 1961. It is possible that brick production might hold back any further rise in house building.