Manufacturing News

South West manufacturers look to people before automation to increase productivity

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Written by: Andrew Merrell | Posted 30 November 2017 14:48

South West manufacturers look to people before automation to increase productivity

The South West’s small to medium sized manufacturers are expecting sales and profit levels to increase, according to a survey of the region’s SMEs.

According to the South West Manufacturing Barometer firms are talking positively as they look for productivity gains from their workforce and existing equipment ahead of investment in automation.

The quarterly survey suggests that the region’s manufacturers are focussing on boosting productivity over the next six months, bucking the overall trend for the country’s productivity level, described by the Chancellor Philip Hammond as ‘stubbornly flat’ in the Budget.

Conducted by SWMAS (part of Bridgwater based Exelin Group), the quarterly survey asked around 90 manufacturing industry leaders in the region how they plan to increase their business’ productivity.

Just 43 per cent of respondents said they were planning to invest in new equipment, down from a high of 57 per cent in Q4 of 2016, and only 41 per cent are planning to recruit to meet future increases in sales – the lowest recruitment figure the Manufacturing Barometer has reported since 2013 Q2.

Yet the survey suggests that sales growth in the sector looks set to continue. An overwhelming majority (66 per cent of respondents) reported an increase in sales in the previous six months, and 61 per cent are confident their business will enjoy sales growth over the next six months reinforcing the need to improve productivity in order to deliver growth.

Manufacturing has proved relatively buoyant in recent years despite economists’ warnings that the UK’s productivity continues to lag behind its major trading partners such as the US, France and Germany (according to Office for National Statistics figures).

With the impact of Brexit further underlining the importance of efficiency, the Government’s industrial strategy for addressing the UK’s ‘productivity puzzle’ has increasingly looked to robotics and automation to boost productivity levels.

However, when asked how they would most like to improve productivity, most respondents to the South West Manufacturing Barometer said they are prioritising smarter working practices and better utilisation of existing equipment over new equipment or automation.

In a further show of the sector’s strength in the region, 46 per cent of respondents said they expected profits to grow in the next six months, while 47 per cent have seen profits increase over the last six months.

Simon Howes, CEO of business improvement consultancy Exelin Group, said: “As we heard in the Chancellor’s Budget, productivity is a key enabler of economic growth and manufacturers clearly understand the need to improve productivity levels to remain competitive and release capacity to grow.

“However the Government seems to be focussing more on infrastructure and R&D to solve the productivity puzzle whilst manufacturers are telling us a different, more complex story.

“They clearly want to get the most out of their existing people and processes before investing in R&D, automation and robotics.”

To help manufacturers address these needs, SWMAS is launching its ‘productivity 2020’ campaign and is reaching out to manufacturers through a series of expert productivity workshops and in-company productivity reviews to ensure businesses get the most out of their existing operations and to pave the way for future investment.

To register your interest and receive more information please email info@swmas.co.uk.

The South West Manufacturing Barometer is part of the National Manufacturing Barometer, the largest survey conducted of SME manufacturers in the UK, and asks senior decision makers for their views on business performance, future trends and government policy. This survey covers autumn 2017 (July, August and September 2017) with businesses surveyed in October 2017.

 

 

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