UK SME manufacturing sector buoyant and confident about future growth

Published:  06 February, 2019

According to the latest MHA Manufacturing and Engineering Report, UK small and medium-sized enterprises (SME) manufacturers remain optimistic and confident about future growth, despite the uncertainty surrounding Brexit, rising production costs and skill shortages.

• 71% of manufacturers reported revenue growth in the last year and 70% predict business growth over the next 12 months.

• 41% have high or above average business expectations over the next 12 months (increasing to 43% over the next three years) and 50% are looking to increase their capital investment spend in the coming year.

• 58% of respondents export products and all exporters currently do so to the Eurozone.

• 93% believe their main competitors are based within the UK and 35% agree they’re within their own region.

• Only 30% cite Brexit uncertainty and trading tariff concerns as their main barrier to future success and just 34% have a strategy in place for post Brexit - 66% feel they cannot plan for the impact until they know the Government’s strategy and EU response.

• 92% believe rising production costs will impact their business next year, but in a positive move, 67% intend to absorb any price increases, rather than pass them onto customers, and 52% intend to achieve this through improved productivity and efficiency.

• Staff recruitment is an equally big issue; 81% of respondents report problems in finding people, yet 49% expect to increase payroll numbers next year. Out of these, 63% will opt for apprentices.

The manufacturing and engineering survey - compiled by MHA, the UK-wide group of accountancy and business firms and supported by Lloyds Bank Commercial Banking in association with the Institution of Mechanical Engineers – reveals a buoyant sector that’s not letting political and economic uncertainty drag it down.

Businesses are not only predicting future growth; over half are confident about the future, they’re making themselves more efficient in order to counter price rises and are looking for ways to bridge the skills gap.

For more information about MHA, visit www.mha-uk.co.uk

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