West Midlands manufacturers yet to see lift off as growth prospects remain anaemic, survey suggests
West Midlands manufacturers have yet to see an immediate boost from a change of Government but, in contrast, are forecasting an improvement to overall economic prospects from a period of greater political stability.
The findings come in the quarter three Manufacturing Outlook survey published by Make UK and business advisory firm BDO.
It shows that while growth in manufacturing continues to be anaemic at best, almost six in ten companies (58 per cent) believe that the recent change in Government will lead to better economic growth overall in the next 12 months.
In contrast just six per cent of companies expect GDP to decline this year as a result of the new Government.
According to the survey, the balance on output in the West Midlands was +0 per cent but is forecast to jump to +20 per cent in the next quarter. Total orders are following a similar pattern, increasing to 30 per cent in the next three months.
The region has reported a dip in recruitment intentions (-16 per cent), although investment intentions are positive at +10 per cent reflecting the new lines and models coming on stream at car plants in the region.
Despite the mixed picture, business confidence in the West Midlands is continuing to climb, reaching levels last seen at the beginning of the recovery from the pandemic.
Make UK is forecasting that manufacturing will grow by 0.5 per cent in 2024. This is a downgrade from 1.2 per cent forecast in the last quarter but is due to ONS revisions on which the forecasts are based. GDP is forecast to grow 1.1 per cent in 2024 and 1.8 per cent in 2025.
Chris Corkan, Region Director at Make UK in the Midlands, said: “This quarter presents a tale of two halves for the West Midlands. Investment remains positive and business confidence continues to climb and, with an Autumn Budget and Spending Review fast approaching, now is the time for Government to pick up the pace and deliver on pre-election promises, most notably the publication of a long-term robust Industrial Strategy."
Jonathan Lanes, Head of Manufacturing at BDO in the Midlands, added: “West Midlands manufacturers are hopeful that a period of greater political stability will provide a better economic outlook ahead, and that in turn is boosting business confidence. Time will tell if that confidence can translate to orders and output, or indeed recruitment intentions where the region relies heavily on skilled workers taking up manufacturing positions.”
