This year’s survey of manufacturers attracted responses from all areas and activities, from automotive, aerospace and agribusiness to plastics, renewables and steel.
Confidence is higher than we have seen for a number of years. Levels of investment are up, as are vacancies. Companies are looking to the future with commitment to more plant, machinery and equipment, and are actively seeking the skills they need to take them forward.
The Eurozone may still be struggling and that is not a good thing for the UK, as the EU as a whole is our largest trading partner by far. What is encouraging is that the response to challenges nearer to home has been to look further afield. The drive is on to expand in existing overseas markets and to develop new ones. The efforts of UKTI and UKEF seem to have been appreciated; they are both rated pretty highly by those who have worked with them.
Concerns about finance – cashflow in particular – are at lower levels than we have seen before. The banking crisis of the last few years has had an effect, though; companies are more likely than ever to look beyond conventional bank loans and overdrafts for their funding.
If there is a cloud on the horizon, then it is about skills. The connection between industry and schools was broken years ago but it has to be remade, if manufacturing is to sustain high-skill, high-wage activities. This is a task for all parties: government, schools and businesses. It is essential that we all work together to build a balanced economy, with UK manufacturing playing a prominent and recognised role.
Responses for the survey were gathered before the collapse in oil prices and the destabilising of Russia’s Rouble. The lower oil price is two-edged: it has a positive effect on industry’s costs, from transport to heating, but it also impacts on engineering and manufacturing, especially on the East Coast and in Scotland.
So far, over the winter and into 2015, the picture has remained broadly positive. Our sincere thanks to everyone who participated in the survey and to our sponsors, for their support.