Manufacturers see positive outlook for 2022

18 January, 2022

“We are particularly pleased by the breadth of net zero ambitions reflected in the report. Across the UK we’re seeing an increasing number of businesses underpin their environmental, social and governance strategies with practical applications to decarbonise their operations and ambitions to build out their green skill base through the recruitment of 'green' jobs, a move that has already been flagged as outperforming the UK sector average in our recent Green Jobs Barometer.”

The more positive outlook for growth is reflected across all major markets with 40% of companies forecasting growth in exports to the United States, closely followed by the EU. Around a quarter (26%) are looking for growth in Asia and around one in five to the Middle East (21%). However, the EU market is set to see the biggest decrease in exports by 10% of companies.

The survey also provides encouraging indicators on the strategies manufacturers are adopting to build resilience and agility into their business by looking at their supply chain, investing in people, innovation and green technologies.

Up-skilling or retaining existing staff was the biggest priority for around two thirds of companies (67%) followed by new product development (60%) and capital equipment (54%), while almost four in five companies (78%) envisage a significant or moderate increase in their productivity this year.

Skills and talent also dominated the risk factors companies were facing with access to Labour seen as the biggest risk by almost two thirds of companies (58%), while almost nine in ten companies were not just worried about losing skills from their business but, the sector entirely. Encouragingly, despite the current financial challenges almost half (45%) of companies said they still planned to invest in Apprenticeships in 2022.

The need to build resilience into business models has been highlighted by supply chain shortages and the survey shows around a third of companies

(35%) are planning to counter this by using British rather than international suppliers, while almost a third (31%) said they were planning to re-locate some or, more of, their production back to the UK.

The survey also shows the increasing drive towards ‘net zero’ for manufacturers. Half of companies (49%) said they plan to invest in green technologies or energy efficiency measures in 2022, with a third saying this investment has increased. A third also said the process to transition to ‘net zero’ had been accelerated by the recent COP 26 Conference.

Make UK has forecast that manufacturing grew +6.9% in 2021 and is predicting growth in 2022 of +3.3%.

The survey of 228 companies was conducted between 8 and 29 November 2021.

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