Member Article

Double digit manufacturing growth in South East despite skills gap

Over half of manufacturers along the south coast and in the Gatwick Diamond area are predicting double digit growth this year, despite struggling to recruit skilled people, according to Carpenter Box, the Sussex-based firm of chartered accountants and business advisors.

The findings, gathered by Carpenter Box as part of the annual MHA Manufacturing Survey report, also reveals that more than 8 in 10 local manufacturers want the UK to stay within the EU, although 62% want the terms of membership renegotiated. The Eurozone is by far the most popular export market with 98% of firms who export having it as a destination.

The survey, supported by the manufacturing team at Lloyds Bank Commercial Banking, sampled predominantly SME manufacturing and engineering businesses, and found that a third of respondents felt a lack of skilled recruits was already a barrier to their business growth and thus they wanted more emphasis on skills training in schools and colleges to help develop the next generation of engineers and technicians.

Nine out of 10 companies also said their production costs would rise in 2015 for the fourth year in a row, primarily through higher wages. It seems with over 70% feeling unable to increase prices to customers, productivity gains are becoming ever-more important.

Meanwhile, red tape continues to be an issue for manufacturers, with 98% stating it was a concern for their business – and with 68% feeling that the burden of regulation was actually increasing.

Chris Coopey, Head of Manufacturing at Carpenter Box and MHA, commented: “The survey provides a valuable insight into the challenges facing the sector in our area, with considerable growth potential but with many companies struggling to recruit the skilled people needed to help deliver plans for growth. Whilst there is a developing focus on STEM in our secondary system, a new University Technical College in Newhaven, sponsored by the University of Brighton, and a new engineering school being developed by the University of Chichester with support from Coast to Capital LEP, much more needs to be done at every level to produce motivated young people with the qualifications to meet the needs of local employers.”

Key findings:

• 54% of local manufacturers predict growth in excess of 10% for 2015, with a further 34% expecting growth of a lesser magnitude.

• 35% of businesses have difficulties recruiting appropriately skilled staff and would like to see the government expand skills training in schools and colleges.

• 80% of businesses in the region undertake some Research and Development (R&D), with 12% investing over 10% of turnover, above the national average.

Carpenter Box will be holding two breakfast events to feedback to manufacturers, engineers and technologists the results of the 2015 Manufacturing Survey. The first will be held on 21 October at South Lodge Hotel near Horsham and the second will be held on 22 October at the Amex Stadium, Falmer near Brighton. Both events start at 8am and will be addressed by manufacturing guru Philippa Oldham, Head of Manufacturing & Transport at the Institution of Mechanical Engineers (IMechE), who contributed to the report.

Places are limited so if you would like to attend either of these events, please register via http://www.carpenterbox.com/mansurv/, or contact Lucy Tunstall at Carpenter Box on 01903 234094.

A copy of the report can be downloaded via: http://www.carpenterbox.com/assets/2015-MHA-Manf-and-Enging-Report.pdf

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This was posted in Bdaily's Members' News section by Colin Bridgman .