Manufacturers should prepare for a 'bumpy ride', says North East business leader
Liz Mayes, North East regional director at trade organisation EEF, claimed that political uncertainty and the UK’s decision to leave the EU has added to the risks British manufacturer’s face.
Ms Mayes said: “Global political upheaval means that 2017 looks set to be another bumpy ride, with manufacturers forced to navigate uncertainty, unpredictable economic conditions and a number of risks that have been amplified by Brexit.
“Against this backdrop a smooth journey is far from guaranteed, but firms are strongly attuned to the challenges and remain fully focused and determined to deliver on their long-term plans for growth.
“With a new digitally-driven industrial era on the horizon and everything to play for, this long-term vision and focus is vital – despite the peaks and troughs manufacturers cannot afford to be diverted away from where they need to be.”
The warning is backed up by a survey of UK manufacturers, 46% of which believe their company will face more risks than opportunities during the year ahead. In comparison only 23% of firms believe they will have greater opportunities in 2017.
While companies are realistic about the challenges they face 47% also believe that the UK’s economy will decline over the year.
Despite the gloomy outlook for the year ahead business owners are still looking to face the challenges head-on and plan to expand their businesses.
Over the next year 56% of firms expect to increase productivity while half of companies expect to boost UK sales.
Ms Mayes adds: “In many ways 2017 is likely to be another unprecedented year of change and uncertainty, but the UK manufacturing sector remains ambitious, resilient and adaptable.
“These strengths coupled with firms’ sophisticated and dynamic business strategies should help keep our sector on course and I would urge the Government to play its part too by ensuring that it implements a strong, robust and comprehensive industrial strategy to support UK manufacturing’s drive for growth and technological innovation.”
The manufacturing sector was bouyed at the end of 2016 after output soared to a two-and-a-half year high. The increase in production was boosted by the low value of the pound.
However, 2017 has already seen blows struck to the North East’s manufacturing industry after AEI Cables revealed nearly 250 people are set to lose their jobs when the factory in Birtley is shut down.