William Schomberg and Ana Nicolaci da Costa London

Britain’s economy extended its strong recovery into this year, data showed yesterday, with manufacturing jumping by much more than expected, companies reporting a buoyant first quarter and signs of a pick-up in wages.

Manufacturing output expanded 1 percent in February from January and was 3.8 percent higher than in the same month last year, the biggest increase by that measure in three years. Economists had expected a month-on-month increase of 0.3 percent and a 3.1 percent rise for the year.

Overall industrial output, which includes power generation and Britain’s North Sea oil production as well as manufacturing, climbed 0.9 percent on the month. It recovered from a weak January, when bad weather hampered North Sea oil and gas production.

Industrial output was up 2.7 percent on a year earlier.

Annalisa Piazza, an economist at Newedge Strategy, said the data suggested Britain’s economy grew 0.7 percent in the first quarter, maintaining its pace from the last three months of 2013.

There were other signs of gathering strength in the economy. A survey by the British Chambers of Commerce showed six key manufacturing balances, including investment plans, hit record highs in the first quarter. Services were strong, too.

A second survey showed British employers were raising the salaries they offered to new permanent staff at the fastest rate in nearly seven years as they struggled to fill vacancies.

But it remains to be seen if the strength in manufacturing will continue. A survey of purchasing managers published last week showed Britain’s factory sector saw its slowest growth in eight months in March. – Reuters