Manufacturers positive about their own 2012 prospects

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I blogged earlier on this week about how manufacturers were somewhat gloomy about growth for the UK economy and even about their own industry's prospects in the year ahead.

However, manufacturers are more likely to be taking a ‘glass-half-full view' of their own company's prospects.

Companies remain confident about their performance in export markets, with over four fifths expecting sales to be the same or greater in 2012 compared with last year and response balances are positive across all manufacturing sectors.

Responses on likely sales in the UK market are also broadly positive, especially among SMEs.

The outlook for recruitment, while positive overall for both temporary and permanent employees, is skewed towards large and small firms respectively. The main sectors likely to see growth in permanent employment are mechanical and transport sectors.

This tallies with recent reports of significant investment commitments from companies in these industries and the likely associated benefits through the supply chain. Whilst the intent to recruit is there, we will have to see whether firms are able to attract and retain the skills they need.

If there is a weak point to executives' expectations on firm-level performance it is around profitability. Across all companies, 35% of manufacturers expect an improvement in profit margins compared with 31% predicting a further squeeze in 2012.


Senior Policy Researcher

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