ANNUAL MANUFACTURING REPORT 2016

FOREWORD
ANNUAL
MANUFACTURING
REPORT2016
FOREWORD
Welcome to the Annual Manufacturing Report 2016.
Our annual survey of manufacturers attracted responses from across a
vast range of manufacturing activities including the UK’s leading areas
of automotive and aerospace, through to furniture and steel.
The resilience of Britain’s manufacturers in the face of unending challenges
seems to put into action the phrase: when life gives you lemons, make
lemonade. Eurozone countries still struggling? China’s economy slowing
down? Look elsewhere in SE Asia and beyond. If sanctions close the door
to Russia, look to the growing markets in Latin America. If the currency is
moving against you, move upmarket and add value.
It would be Polyanna-ish to claim that everything in the garden is
completely rosy, however. We have seen an overall downturn in
manufacturing in the UK, led by the steel sector, which is reported to
have shrunk by nine per cent. The fall in energy prices has led to a
decline in activity in the North Sea. The strength of Sterling makes for
tough competition in international markets and has had an effect in
the domestic sphere as well. Nonetheless, UK exports of higher addedvalue
products has remained strong.
Political uncertainty was largely ended by the result of this year’s
General Election. Investment in automation and information and
communications technology is at historically high levels and likely to
continue that way. Vacancies seem to remain generally plentiful.
Once again, the greatest and most widely-shared concerns are about skills.
To put it bluntly, our education system is failing our youngsters and,
consequently, creating problems for industry. Kids coming out of schools and
Further Education colleges at 16 and 18 are reported to be poorly prepared
for work. This isn’t about their skills levels; no-one reasonably expects that a
fresh-faced youngster will have the skills and experience of a veteran. It is
about basic work preparedness and it has been going on for decades. The
longer it continues the more it will compromise our competitiveness.
The gap in understanding between schools and workplaces must be bridged,
for the sake of our manufacturing base and for our people themselves.
Our sincere thanks to everyone who participated in the survey and to
our sponsors for their support.
By Callum Bentley Editor, The Manufacturer