The findings come from the annual Make UK/PwC Senior Executive survey which asks senior manufacturing Executives on the opportunities, risks and challenges for their business in the year ahead, as well as the outlook for the UK and international economies.
As well as the benefits from an industrial strategy, the survey shows that, despite the current challenges from escalating costs and a potential trade war, almost half of the 161 companies (49 per cent) believe the UK remains a competitive place to manufacture compared to a quarter who disagree.
Over half of respondents (57 per cent) said that they will increase investment in response to a long term industrial strategy. In addition, 43 per cent believe such a strategy will lead to increased productivity, and a similar number (42 per cent) said it will help them secure the skills they need for the future.
Almost two thirds of companies (63 per cent) said that the opportunities for their business in 2025 outweigh the risks, compared to just over one in ten (14 per cent) who disagree.
It was found that companies are responding to these challenges and opportunities by focusing on growth strategies, with over three quarters of companies (78 per cent) developing new products, almost half deploying new technologies and more than a third (37 per cent) planning to enter new markets.
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The survey also gives credence to the view of some Economists that companies will counter the impact of increased costs by investing in new technologies and automation to improve their efficiency.
However, despite these positive intentions, as many companies think the UK economy will deteriorate in 2025 (34 per cent) as improve (37 per cent), while the challenges of increased costs are seen as ‘severe.’
Over nine in ten companies (92 per cent) think their employment costs will increase, more than three quarters (76 per cent) think the costs from other business taxes will increase and a similar number (72 per cent) expect their logistics and transport costs to increase.
Following the recent consultation, Make UK is calling on the Government to set out in detail the full proposals of a formal long term industrial strategy, as soon as possible.
In a statement, Stephen Phipson, Chief Executive of Make UK, said: “Manufacturers have demonstrated their resilience over and over again in recent years and, despite the numerous challenges they face, those that remain innovative and are prepared to invest in new technologies, expanding markets and, most crucially, their people will continue to thrive. But, they can only do this if they are operating in the most favourable business environment and there is little doubt that the next twelve months are set to be immensely challenging in a complex international environment.
“To help companies navigate a way through these challenges it is now vital that Government sets out as a matter of urgency the immediate and significant priorities as part of its formal industrial strategy given the very clear benefits manufacturers believe this will bring. By doing this, it will help re-boot business confidence and ensure the year gets off on a positive footing in terms of the relationship between industry and Government.”
