After years of economic shocks – from Brexit and Covid to inflation, skills shortages and rising taxes – UK manufacturers have taken hit after hit. And a recent survey of 1,000 UK business leaders by Baker Tilly’s UK network member MHA shows the pressure is still on, with tax hikes and investment uncertainty topping the list of short-term challenges.
But it’s not all doom and gloom.
Manufacturers see clear potential in technology and innovation to drive future growth, even if accessing the capital to invest remains a hurdle.
Cybersecurity, too, is front of mind, as recent attacks in other sectors have exposed just how vulnerable operations can be and how costly disruption is.
The UK government’s new 10-year Modern Industrial Strategy was broadly welcomed by the sector, particularly for its focus on upskilling the workforce and attracting foreign investment.
But the real test is whether it will translate into lasting, sustainable, economic growth.
"While our survey highlighted that there are considerable challenges for the manufacturing sector, it also showed that there are bright spots ahead in the next 12 months,” says Chris Barlow, partner and manufacturing and engineering specialist at MHA.
“The announcement of the long-awaited industrial strategy could – and should – be the impetus that the sector needs to set it on the path to more sustainable growth in the UK, with public and private investment and the ability to withstand any further economic volatility.
“Regardless of its impact, there is clear evidence from our research that despite the obvious challenges it faces, UK manufacturing is above all resilient and looking to the future. Investments in technology, R&D and bridging the skills gap are all welcome signs of a sector that is charting its own course for success."
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