U.K. manufacturers are positive on the outlook for the market in 2022, though the optimism is tempered by difficulties in accessing labor and increasing input costs, according to a new survey.
Around three quarters of U.K. manufacturing companies expect conditions to improve in the new year, with 73% now believing the opportunities ahead for their business outweigh the risks, according to data from Make UK and PricewaterhouseCoopers.
The survey of 228 companies, carried out in November, found manufacturers are prioritizing improving productivity, coupled with investment in their workforce and in product development.
“Despite facing an unprecedented combination of continued Covid pressures, cost inflation and supply chain issues, our manufacturers are responding with an impressive amount of agility and resilience, which will stand them in good stead for the year ahead,” said Cara Haffey, PwC’s U.K. industrial manufacturing and automotive leader.
Tempering the optimism, however, are escalating inflationary pressures and difficulties getting access to, as well as retaining, talent and key skills.
Equally, while almost two-thirds of respondents believed the U.K. to be a competitive location for manufacturing, equally as many have said that leaving the European Union has moderately or significantly hindered their businesses. Around 56% of companies fear further disruption this year from customs delays due to import checks and product labeling changes.
Make UK has forecast that manufacturing grew 6.9% in 2021, and is predicting growth in 2022 of 3.3%.
“To build on this we now need to see a government fully committed to supporting the sector at home and overseas. This requires more than a Plan for Growth but a broader industrial strategy that sets out a long-term vision for the economy and how we are going to achieve consistent economic growth across the whole country,” said Make UK Chief Executive Stephen Phipson.