82% of manufacturing CEOs will implement cost cutting this year says a report from PwC.
According to professional services firm PwC’s 16th Annual Global CEO Survey most business leaders around the world are less confident at the start of 2013 than they were last year.
Eighty two per cent of CEOs in manufacturing firms said that they would be pursuing cost cutting strategies this year.
Global economic uncertainty is behind the general feeling of caution among global leaders. But PwCs survey, which canvassed the views of 1,330 CEOs in 68 countries, showed that manufacturer’s conservatism is heightened by higher levels of concern over the cost of energy and access to raw materials. Seventy three per cent of manufacturing CEOs said this worried them.
Barry Misthal, global industrial manufacturing leader at PwC, drew out the wider implication of manufacturing concerns over key resources saying: “Restriction of these critical resources will undoubtedly place pressure not just on the immediate manufacturing supply chain, but those in other sectors such as metals, chemicals and the automotive sector.”
In terms of the global economic outlook, China remained top of the list of markets to watch. The US and Germany followed behind as indicators of market health.
On a more positive note, although cost cutting dominated strategic plans, investment in R&D and skills development remained high on company agendas.
Sixty per cent of the 173 manufacturing firms surveyed, said that addressing skills shortages would be their top priority in 2013. Investment in R&D was in the top three investment priorities for just under half of manufacturing leaders (45%).
Mr Misthal, was unsurprised by the strong emphasis on cost cutting in the Annual Global CEO Survey.
“We know that implementing or continuing cost-cutting initiatives disrupts operations and moral, but during these times, is a painstaking necessity,” he said before commending the longer term commitment to investment in “schemes that will contribute to business growth and give manufacturers a global platform to compete on”.