manufacturing


Main barriers to growth


26% cited global economic conditions, 22% stated recruiting skilled staff and 19% had concerns around Brexit and future trading tariffs. Despite this uncertainty, 48% are still planning to make a significant capital investment in the next 12 months. Of those not investing, 39% put this down to Brexit uncertainty and 69% felt they invest as appropriate and have no foreseeable need.


Excluding apprentices, we asked how many businesses anticipated taking on new staff and found that 48% expected to see an uplift. The categories of staff manufacturers struggled most to recruit were experienced engineers, which 27% have found difficulties recruiting, slightly in front of skilled machinists/technicians at 25%.


67% attributed this to a shortage of applicants and 24% felt there was a lack of motivated applicants locally. Interestingly, most businesses didn’t feel that competition from larger or smaller businesses was a factor.


To address the issue 55% are investing in training current staff, 16% have retained a number of employees who have worked past retirement age, 15% are investing in technology to bridge this gap, while 13% selected ‘other’.


Competitors


Looking at the location of main competitors, 43% stated their competition is based across the UK (this is down from 58% last year). 21% felt competition was within their own region (this is down from 39% last year), and 14% cited the Eurozone, this has reduced by over half from 39% last year.


Research and development (R&D)


Over the years R&D tax credits have been of huge benefit to the sector, yet a number of businesses still remain unaware of the reliefs available. Last year 89% of respondents invested in R&D. This is a 5% decrease on the previous year. Of those who do invest, 48% had successfully applied for tax credits while 29% haven’t applied, 11% do not think they undertake relevant R&D and 5% are unaware of the tax credits. Not all activity will be eligible but many who have not claimed could probably do so and save their business thousands of pounds in the process.


Environmental impact


Thinking about environmental impact, we asked businesses if they had put measures in place to reduce the impact their business has on the environment in the future. 62% said they have with 33% of those saying it is the right thing to do and 29% who see this as a key approach to their business. Of the 38% who said no, 27% felt this was because changes cannot be made at the current stage while, 11% felt it was not a concern for their business.


The full Manufacturing & Engineering Annual Report covers each of the highlighted topics in more depth, with a detailed analysis of the financial data available and a number of case studies. If you would like a complimentary copy please get in touch.


Kate Arnott, Partner & Head of Manufacturing for MHA MacIntyre Hudson in the Thames Valley


T: 01494 441226 E: kate.arnott@mhllp.co.uk macintyrehudson.co.uk


Post Brexit trading 61%


have a Brexit strategy in place.


34% 64% 39% 82%


feel they cannot plan until they know more regarding Brexit negotiations.


of Manufacturing & Engineering businesses have evaluated risk in their supply chain.


expect to see growth of 1-5% in the next 12 months.


Future business strategy for 4.0 and Robotic Process Automation


29% 26% 13% have a strategy.


stated it wasn’t practical due to lack of infrastructure (e.g. lack of 5G technology).


Employment


invest up to 8% on R&D.


55%


In 2019 55% made successful R&D claims.


78% 55% 48%


have difficulty recruiting appropriately skilled staff.


Are investing in training of current staff to combat recruitment issues.


Excluding apprentices, 48% of businesses anticipated taking on new staff.


stated a lack of financial backing to invest.


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