Britain's manufacturers believe the introduction of an industrial
strategy will be a game changer for increasing investment and
boosting productivity, while helping them secure the skills they
need for the future according to a major survey published today.
The findings come from the annual Make UK/PwC Senior Executive
survey which asks senior manufacturing Executives on the
opportunities, risks and challenges for their business in the
year ahead, as well as the outlook for the UK and international
economies.
As well as the benefits from an industrial strategy, the survey
shows that, despite the current challenges from escalating costs
and a potential trade war, a majority of manufacturers believe
that overall, the UK remains a competitive place in which to
manufacture and the opportunities for their business in 2025 far
outweigh the current risks. However, despite this view, as many
think the UK economy will deteriorate as grow in 2025.
In response, manufacturers are backing their belief in the UK as
a place to manufacture with a significant emphasis on developing
new products, entering new markets and upskilling and retraining
staff. The survey also gives credence to the view of some
Economists that companies will counter the impact of increased
costs by investing in new technologies and automation to improve
their efficiency.
Following the recent consultation, Make UK is now urging
Government to set out in detail as soon as possible the full
proposals of a formal long term industrial strategy.
Stephen Phipson, Chief Executive of Make UK, said:
“Manufacturers have demonstrated their resilience over and over
again in recent years and, despite the numerous challenges they
face, those that remain innovative and are prepared to invest in
new technologies, expanding markets and, most crucially, their
people will continue to thrive. But, they can only do this if
they are operating in the most favourable business environment
and there is little doubt that the next twelve months are set to
be immensely challenging in a complex international environment.
“To help companies navigate a way through these challenges it is
now vital that Government sets out as a matter of urgency the
immediate and significant priorities as part of its formal
industrial strategy given the very clear benefits manufacturers
believe this will bring. By doing this, it will help re-boot
business confidence and ensure the year gets off on a positive
footing in terms of the relationship between industry and
Government.”
Cara Haffey, Leader of Industrials and Services at PwC UK,
said:
"While it's true that UK manufacturers are navigating a complex
business landscape - compounded by rising costs - there's a
palpable sense of optimism and resilience underpinning the
sector's trajectory for 2025. This optimism is fuelled
by hopes of increasing clarity on the proposed UK industrial
strategy, as well as a decisive shift towards technology
adoption. The sector is moving from viewing technology as a
source of incremental improvements towards acknowledging its
power to transform operations.
“Additionally, there's a strong focus on innovation, with
companies investing in new product lines and business development
to seize growth opportunities. This approach, alongside efforts
in product development, upskilling, cost management, and
embracing technology, positions manufacturers well to navigate
challenges and contribute significantly to national economic
growth."
According to the survey, more than half of companies (57%) say
they will increase investment in response to a long term
industrial strategy. In addition, more than four in ten (43%)
companies believe such a strategy will lead to increased
productivity and a similar number (42%) say it will help them
secure the skills they need for the future.
The survey also shows that, despite the challenges companies are
facing at home and abroad, almost half of companies (49%) believe
the UK remains a competitive place to manufacture compared to a
quarter who disagree. In addition, almost two thirds of companies
(63%) believe the opportunities for their business in 2025
outweigh the risks compared to just over one in ten (14%) who
disagree.
Companies are responding to these challenges and opportunities by
focusing on growth strategies with more than three quarters of
companies (78%) developing new products, almost half deploying
new technologies and more than a third (37%) planning to enter
new markets.
However, despite these positive intentions, as many companies
think the UK economy will deteriorate in 2025 (34%) as improve
(37%), while the challenges of increased costs are severe. Over
nine in ten companies (92%) think their employment costs will
increase, more than three quarters (76%) think the costs from
other business taxes will increase and a similar number (72%)
expect their logistics and transport costs to increase.
In response, Make UK is urging Government to look at measures to
mitigate these increases by reducing business rates in
particular, as well as measures and incentives to aid
decarbonisation and energy efficiency
Ends
Notes to Editors
- The survey of 161 senior Executives was carried out between
24 October and 20 November
