Recruitment intentions at a two-year high for UK’s SME manufacturers

The latest National Manufacturing Barometer, conducted by SWMAS (part of Exelin Group) in partnership with Economic Growth Solutions, questioned almost 300 manufacturing SME leaders on the current economic picture, with 53 per cent of them expressing their intention to hire more employees over the next six months.

This is five per cent up on the last quarter and the highest figure reported for over two years, illustrating a strong confidence in the marketplace despite uncertainly over Brexit and trade talks.

In other positive news, the quarterly survey reported that 60 per cent of manufacturers saw an increase in sales, with 68 per cent expecting orders to rise between now and the end of the year.

Investment aspirations – whilst slightly down on the last report – are still healthy, with just under half (48 per cent) planning to spend on new machinery and premises.

Simon Howes, CEO of Exelin Group, commented: “The need to focus on recruitment comes as no surprise and reflects what manufacturers are telling us about their concerns around productivity and the availability of people.

“As we approach Brexit, it’s important to recognise that UK SME manufacturing is proving resilient. The analysis of the key trends and comments in this quarter’s Barometer points to firm intentions of growth, improved productivity and increasing profitability.”

Alucast, one of the Black Countries leading aluminium casting foundries, has seen a major increase in activity in the domestic automotive sector, with a number of new contracts recently secured.

Managing director Tony Sartorius attributes the firm’s success to its ability to work with OEMs and tier 1s in the design process and ensuring it can provide the lightweight casting solutions the big car manufacturers are looking for.

“The last 12 months have been very good for our business. A lot of new car platforms are being developed and we are working on numerous exciting projects that will increase our revenue in the short and long-term.

“Trading is still challenging. We have to be competitive and mindful of the Brexit trade negotiations and the tariffs being imposed by the US on aluminium and steel.”

He continued: “However, we have always been of the viewpoint that we make our own luck and we have invested heavily in our Wednesbury facility to ensure we have the capacity, the technology and the design simulation software we need to be at the forefront of lightweighting in the automotive sector.”

Alucast, which recently celebrated its 50th birthday, currently boasts sales of £7.4m, working with clients across automotive, yellow goods, hydraulics, vacuum and motor cycle industries.

Dean Barnes, regional director of Economic Growth Solutions, said: “It’s perhaps a symptom of the current political and uncertain economic climate that this latest survey highlights clear messages around the need for stability, diversification and exploring new ways of achieving goals.

“New markets, premises, products, service development, better machinery, increasing brand awareness and, most importantly, the recruitment of apprentices and skilled staff were all heavily referenced as part of the feedback we received from respondents.”

The National Barometer’s special focus found many SMEs lacked skilled staff within their manufacturing teams, particularly with technical levels in design, general management and operational levels in sales and marketing.

Bosses also had concerns about the quality of staff training, the attitude of some new recruits, salary expectations and the cost and quality of recruitment.

Simon Howes concluded: “Small to medium sized manufacturers have retained a strong sense of pragmatic optimism and are clearly thinking of their pipeline of skilled and motivated employees when it comes to the stability and growth of their businesses.

“Moving closer to the new industrial and post-Brexit landscape, the need for a wide strategic view of productivity has never been so important.”

The Manufacturing Barometer is the largest survey conducted of SME manufacturers in the UK and asks senior decision makers for their views on factors influencing business performance and the future of the sector.

For further information, please visit https://www.swmas.co.uk/knowledge/manufacturing-barometer or follow @swmas_ltd/@mfggrowthp on twitter. To obtain a copy of the National Barometer, please email info@swmas.co.uk.