UK Manufacturing Industry Data Shows Road to Recovery

Thanks to a range of improvements in input and output orders over the last three months, the UK manufacturing industry has finally begun on its long road to recovery. This is according to stats shown in a new survey published by Make UK and business advisory firm, BDO. 

According to the Manufacturing Outlook Q3 survey by BDO/Make UK, the balances on output within the manufacturing sector have improved to -36% from a staggering figure of -56% shown in the last quarter. 

Not only that, but UK and export orders have also improved substantially - from historic lows shown in the previous quarter and now at -36% and -34% respectively.  

Companies are expecting the prospects for the UK manufacturing industry to continue to maintain an upward trend over the coming months, with the balance forecast for output for the next three months looking to improve to -7%. Whilst still in a deficit and showcasing a negative percentage, this would still showcase a significant improvement for the industry.

Despite having seen positive improvements in the output figures, the Manufacturing Outlook Q3 survey is still, unfortunately, finding negative trends for the industry, one major negative being the balance on investment intentions having fallen to -32% from the more positive -26% in the last quarter. Whilst the manufacturing industry hasn’t quite reached the levels of cutbacks seen during the financial crisis at this moment in time, the downwards trend is following a similar pattern to what we saw during said crisis, which is a concern. 

As an indicator for how far investment has been cut back this year, the balance in the first quarter was +20% as the industry was reeling from greater political certainty following the general election. We saw the biggest cutbacks in the Wales, Scotland and Yorkshire & Humber areas.

While manufacturing has begun to see an upward trajectory in the figures showcased in this BDO/Make UK survey, it is clear that there is still a long way to go for the industry as a whole compared to the staggering depths seen at the beginning of the year. With a highly volatile and unpredictable landscape ahead of the UK over the next few months in particular - it is incredibly difficult to call what might be in store for the UK manufacturing industry. 

It’s important to note that the uncertainty surrounding the Brexit negotiations, and in particular the very real possibility of a no deal Brexit, could have a further astronomical impact on the manufacturing industry of the UK. The combination of that outcome with the continued impact of the coronavirus pandemic that we’re currently in the midst of could cause further damage to investment prospects in the latter part of the year and throughout 2021 too.

Manufacturing jobs 

From a job market point of view, we are beginning to see a slight increase in the number of manufacturing jobs advertised, with UK manufacturers eager to come back with a bang and adapt to these challenging conditions. If you are looking for a manufacturing job or are a manufacturer eager to bring fresh talent into your firm, contact us today.