Manufacturers discuss export and inward investment priorities with Trade and Investment Minister
EEF hosted a private roundtable dinner with the Minister of State for Trade and Investment, Lord Livingston. EEF outlined its priorities for trade and investment policy and there was discussion around the role of UKTI and the support offered to UK businesses looking to export. The Minister also discussed the Government’s wider business policy priorities for the general election. EEF will continue to meet with senior Government Ministers, Shadow Ministers and officials to brief them on manufacturers’ priorities in the run up to the general election.
For more information contact Hywel Jarman, Director of External Affairs
Meeting with Minister of State at the Department for Transport
EEF met with John Hayes MP, Minister of State at the Department for Transport, to discuss a wide range of issues, including the Government's ongoing plans to turn the Highways Agency, which manages England's strategic motorway and A-road network, into an arm’s length body. We also discussed the recently published Road Investment Strategy, which identified solutions to some of the most notorious challenges on the road network.
EEF also raised proposals for a UK Infrastructure Authority. This organisation would provide a step change in how the UK’s infrastructure requirements are identified, enabling debates on infrastructure projects to take place far earlier and thereby supporting the infrastructure supply chain to invest more strategically in the talent and equipment required.
Finally, we stressed the importance of a decision being taken swiftly on new runway capacity following the publication of the Airports Commission report expected in July. This report will make a recommendation on whether runway expansion at Heathrow or Gatwick should be allowed to go ahead.
For more information contact Chris Richards, Senior Business Environment Policy Adviser
Briefing with Labour Business Adviser
This week EEF met with Tess Lanning, Business Policy Adviser to the Labour Leader Ed Miliband. We briefed her on the latest state of trade for manufacturing and key themes that will form part of EEF’s forthcoming manifesto for manufacturing. We also discussed a wide range of policy issues, including industrial strategy, access to skills, access to finance and tax policy. As part of our ongoing engagement with the Opposition we will have further meetings with the Labour Party ahead of the Budget and General Election.
For more information contact Rocky Lorusso, Head of Government Affairs
Steel industry on the agenda in Opposition Day debate
On Wednesday, the Labour Party debated the importance of the steel industry in their opposition day debate. Led by Iain Wright MP, Shadow Industry Minister, the motion tabled expressed concern with Tata’s proposed sale of its Long Products Division and the impact this could have on UK steel industry capacity.
The motion also welcomed efforts of UK steel producers to cut carbon emissions but expressed concern that losing trade to countries with less efficient processes could increase global carbon emissions. The party called on the Government to work with stakeholders and industry to provide a coordinated plan for the industry’s future.
MPs also expressed support for the Charter for Sustainable British Steel, which has been launched by UK Steel and producers such as Celsa. The Charter seeks to promote domestic procurement, sustainability in the supply chain, a level playing field for UK producers, and the need to combat the threat posed by increasing Chinese imports.
EEF and UK Steel will continue to engage with MPs and express their concern about these highly relevant issues, and encourage organisations to adopt the Charter.
For more information contact Ian Rodgers, Director of UK Steel
EEF contributes to EU fact finding on UK business environment
As part of their annual review of UK policy developments to support competitiveness, officials from the European Commission were exploring how changes in the business environment have been regarded by businesses. EEF outlined recent trends in UK manufacturing and provided comment on the access to finance landscape and progress on skills and apprenticeship funding policy. Our recommendations on the improvements needed to the innovation landscape in the UK were also highlighted.
For more information contact Lee Hopley, Chief Economist
EEF and Labour MEP visit Milton Keynes manufacturer
EEF arranged a visit with Anneliese Dodds, Labour MEP for the South East of England, to Lohmann Technologies (UK) in Milton Keynes. The company is a specialist adhesives manufacturer and converter employing 39 staff. Ms Dodds was given a tour of the factory by Managing Director, Roger Churchill, and EEF’s South East Region Director, Jim Davison.
Ms Dodds was shown how Lohmann had expanded its capabilities in processing and product range and how the company has continued to grow through the recession. The firm doubled its premises in 2010 and predicts further expansion in the next few years. Its forecasts are in line with findings from EEF’s Exec Survey 2015, which indicates that Britain’s manufacturers are feeling ‘cautiously confident’ with a stronger than average two per cent manufacturing growth forecast for 2015.
For more information contact Jo Ganly, Head of PR
Exec Survey 2015 – cautious optimism for the year ahead
EEF’s annual Exec Survey , which examines manufacturers’ outlook for the year ahead, indicates that firms are cautiously confident for 2015. The number of manufacturers expecting economic conditions to improve has almost halved since last year’s survey from 70% to 37%. At the same time, the number expecting conditions in the UK to deteriorate has tripled, rising from 5% to 17%. Global conditions are of greater concern for manufacturers, with 38% expecting them to worsen.
Half of the companies surveyed report rising input costs as a source of risks for 2015 and a quarter report it being their top risk to growth. This year, non-wage employment costs appear to be feeding into firms’ concerns, with auto-enrolment costs and possible payments from holiday pay changes rising up the cost agenda.
Significant movements in exchange rates continue to be a source of risk for companies, with 38% saying this might have an effect on growth this year, a small increase compared with the 2014 survey. Sterling has seen significant fluctuations over the past year as a consequence of domestic political factors and expectations earlier in 2014 of an increase in UK interest rates – a factor that could be in play again this year.
External finance remains a worry for 7% of firms – unchanged from the previous year. However, cashflow problems and changing payment terms, usually extensions, are regarded as more of a risk, with these concerns becoming somewhat more prevalent across the sector over the past year.
On a more positive note, 70% of manufacturers say that the UK will be a competitive location for them in 2015. 69% expect to improve productivity, 58% expect to boost UK sales and just under half (49%) expect to be taking on more permanent staff. Export sales also look positive with 49% expecting to see an increase in 2015 and 30% expecting them to remain steady. North America, Asia and South America are expected to be hotspots for export growth and, in line with ongoing economic and geo-political uncertainty, Europe and the Middle East are seen as less promising.
With all of these factors, it is not entirely clear whether 2015 will be a year of risk or opportunity. A third of manufacturers (35%) see more risks than opportunities for their business in the year ahead, the exact same number as those who do not.
For more information contactLee Hopley, Chief Economist
In the media
The findings from EEF’s Exec Survey 2015 were widely reported in The Financial Times (£), The Times (£), The Daily Telegraph, The Guardian, The Daily Mail, The Independent and The Daily Express. Chief Executive Terry Scuoler was also interviewed on BBC News.
Our response to the latest IoP and trade data featured in The Financial Times (£).
Week in review
The Consumer Prices Index increased by 0.5% in the year to December 2014, down from 1.0% in November. This marked the joint lowest CPI inflation rate on record with the measure last coming in at 0.5% in May 2000.
The overall input prices for manufacturing fell 10.7%in the year to December, compared with a fall of 8.2% in the year to November..
The week ahead
21st January: Labour market statistics