But UK State of Manufacturing 2023 Report shows supply chain issues could continue for five years or more
Almost three quarters (70%) of engineers working in UK manufacturing report that business has returned or even exceeded pre-pandemic production volumes as the darkest days of COVID-19 appear to be fast disappearing into the rear-view mirror.
Businesses in the aerospace, electronics and energy sectors all point to a substantial recovery with 72%, 59% and 71% of respondents respectively flagging a return to pre-COVID-19 levels of production.
But not every sector is in such rude health: 60% of respondents in the automotive industry say output in their firms has been reduced, and access to skills, supply chain issues and the move to hybrid/remote working were all cited as particular challenges across all areas of manufacturing.
The State of Manufacturing 2023 Report by Essentra Components sought to uncover the biggest concerns facing engineers working in UK manufacturing. One of the most important studies of its kind ever to be commissioned, the report focuses on respondents’ attitudes to future talent, technology, sustainability, and a heavily impacted supply chain in a post-COVID world.
Scott Fawcett, Chief Executive Officer, Essentra PLC, says the performance of the manufacturing sector is often seen by Government and the media as a barometer for the UK’s wider economic wellbeing: “With this report, we are demonstrating our responsibility as a leader to dig beneath the surface and find out what is really going on behind the numbers, to help inform future decision making.”
The issue of skills was a particular concern, with almost three quarters (74%) saying new recruits frequently lack the skills and qualifications needed to succeed in a modern manufacturing environment.
Perhaps of greatest concern, however, is the supply chain: exactly half (50%) say supply chain pressures have had a significant impact on their business, and 62% expect those issues to remain for anything up to five years. Some 15% even believe they could go on indefinitely.
To mitigate the effects of these challenges, manufacturers are taking a variety of actions from sourcing new suppliers (64% of respondents) to increasing prices (43%) and exploring ways of reducing overheads (just under 30%). Around a quarter of respondents also report using supply chain forecasting models, and even reshoring aspects of production, to anticipate and address supply chain delays.
On a more positive note, most (90%) say their firms have an active technology investment plan and almost two out of three (61%) view the drive for increased sustainability as an opportunity, rather than a threat.
Scott says it is reassuring to see so many positives from the report: “Despite the challenges of COVID-19, manufacturers appear to be bouncing back with production volumes and financial revenues recovering to pre-pandemic levels,” he says.
“It is encouraging to read of the investment many are making in technology and innovation, and in addressing the challenges of a disrupted supply chain. It is also pleasing to see the continued focus on sustainability, making our industry and our planet fit for future generations. It’s something we can be proud of, both professionally and personally.”
Other interesting findings from the report relate to employees’ health and wellbeing. Whereas manufacturing has always attached considerable importance to physical wellbeing, it is now also focused on an employee’s mental health. More than three quarters (77%) said they feel their mental wellbeing is supported by their employer.
Scott adds: “It is similarly pleasing to see the focus on staff, and that mental as well as physical health is fast making its way to the top of the boardroom agenda.
“None of us, however, can afford to be complacent,” he concludes. “Neither can we ignore the challenges ahead, but neither should we ever doubt the resilience of the manufacturing industry, and its ability to surprise.”
To download the full report, visit: https://www.essentracomponents.com/en-gb/state-of-manufacturing-2023
