Credit crunch and skills crisis dent business confidence in manufacturing for 2008

Many managers focus on the impact of rising business costs, higher levels of debt and a shortage of management skills. The survey shows a 9% decrease in senior executives in the sector who are confident about the year ahead. Asked specifically about business prospects for their organisations, 46% claimed they are ‘optimistic’ about 2008, compared to 55% last year. Those who are ‘uncertain’ about what next year will bring has risen from 5 to 20% in this year’s survey. Unsurprisingly, it is clear from the findings that the economic climate and higher business costs are taking their toll on business confidence in the sector. 83% say the rising cost of energy will impact negatively on their business, while 43% blame the credit squeeze in financial markets. 57% also report they will be hit by the extension of maternity and paternity leave in 2008. 54 % in the survey also say that a shortage of management skills in the UK will have a negative impact on their performance. However, this does not seem to have prompted a greater focus on skills development with 1 in 5 (20%) employers predicting a decrease in training and development. Despite the pessimism, individuals in the manufacturing sector are just as motivated as last year to be successful. 2 in 10 say they plan to learn a new language in 2008 and half 49% are aiming to make more money. 51% report they want to spend more time with family and friends to improve the balance between their personal and professional lives. Jo Causon, director of marketing and corporate affairs for the Chartered Management Institute, says: “In the current climate, it is natural for employers to feel some degree of uncertainty. However, the decline in organisations developing their managers is a great concern. If employers fail to invest in the skills needed for long-term success, the UK will find it difficult to compete on a global scale in the future. It is encouraging that some individuals are taking the initiative and planning to develop themselves through qualifications and higher education in 2008.”