The quarterly survey, which is conducted by SWMAS (part of Exelin Group) in partnership with Economic Growth Solutions (EGS), asked over 280 manufacturing industry leaders how they plan to increase their business’ productivity.
Just 43% of respondents said they are planning to invest in new equipment and only 40% are planning to recruit to meet future increases in sales – the lowest recruitment figure the Manufacturing Barometer has reported since 2013.
Despite this, the survey still suggests that sales growth in the sector looks set to continue. An overwhelming majority of firms (61%) reported an increase in sales over the last six months, while 59% are confident this trend will continue - underlining the need to improve productivity, in order to deliver growth.
In a further show of the sector’s strength, 47% of respondents said they expected profits to grow in the next six months, while 41% have seen profits increase over the last six months.
Says Exelin Group chief Simon Howes: “This survey demonstrates that the country’s SME manufacturing sector is as robust and adaptable as ever with profits and sales continuing to increase, despite market uncertainties.
“Manufacturers clearly understand the need to improve productivity. However, with much in the news about automation and robotics, it may come as a surprise to policy makers that for many businesses the first priority is to optimise existing resources.
“The upshot is a call to action for government and support bodies to provide resources and a focus on helping manufacturers realise their existing potential and work smarter now. Getting this right will help make the case for investment in robotics and automation, which is vital if the UK is to remain competitive in the mid to long term.”
Adds Dean Barnes, regional director of economic growth solutions and the Manufacturing Growth Programme (MGP): “Increasing productivity isn’t about doing just one thing or another, it’s more about taking a whole review of the business and identifying areas where you can improve efficiencies, reduce waste and seek competitive advantage.
“This is often a combination of factors and our manufacturing growth managers on the ground are working with hundreds of firms to help them achieve this. Investment in people and investment in automation shouldn’t be viewed in isolation, they are often mutually beneficial.”
The Manufacturing Barometer is the largest survey conducted of SME manufacturers in the UK and asks senior decision makers for their views on business performance, future trends and government policy. This survey covers autumn 2017 (July, August and September 2017), with businesses surveyed in October 2017.
