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Northern Powerhouse European Union

Major Growth for North West Manufacturing

The North West now boasts 14,560 manufacturing firms, accounting for 15.5% of the region’s total output – the third highest of any UK region.

  • North West now boasts 14,560 manufacturing firms – up 1.6% since 2010
  • Manufacturing accounts for 15.5% of the region’s total output – the third highest of any UK region
  • 318,000 people are now employed in manufacturing across the region in March 2017 – accounting for 8.8% of the region’s total workforce
  • The North West accounted for 10.4% of the UK’s manufactured exports in 2016
  • 52% of the region’s goods exports go to the Europe
  • North West saw biggest increase in output and orders of any UK region in last year

A new report from EEF, the manufacturers’ organisation and BDO LLP, the accountancy and business advisory firm, shows that North West manufacturers have seen the biggest improvement compared to every other UK region in the last year, with the biggest increase in output and orders balances.

However, despite a strong year as a whole, output has started to tail off in the last three months as consumers start to tighten their belts due to budget cuts and a squeeze on real incomes. The pharmaceutical sector, which accounts for 20% of the region’s manufacturing, has had a poor start to the year while weaker consumer spending has hit the food & drink sector.

An improved picture is forecast for the second half of the year, however, which is reflected in improved job prospects where companies on balance expect to increase recruitment. This continues a trend over the last three years where North West recruitment intentions have trended above the national average.

The annual report – Regional Manufacturing Outlook – was published on 24th July and draws in survey data and the latest ONS figures to provide a longer-term and in-depth picture of the health of UK manufacturing. This year, it reveals that the North West now boasts 14,560 manufacturing businesses in the region, with food and drink, transport equipment and pharmaceuticals being the region’s main sectors.

The region continues to enjoy a healthy export record, accounting for 10.4% of the UK’s manufactured exports. Despite 52% of the region’s exports going to the EU, this is the lowest of any UK region. In contrast, the share of North West exports which go to Asia, the Middle East, Africa and North America are above the national average.

Richard Halstead, Interim Region Director in the North West at EEF, said:

“Positive trends in UK manufacturing are being reflected here in the North West with the region seeing across the board improvement since the third quarter 2016. Confidence within the sector across the region remains strong in spite of a squeeze on domestic budgets.

“Uncertainty around the UK’s future relationship with the EU could be however hampering investment, but overall the outlook is positive.”

Graham Ellis, Director and Head of Manufacturing at BDO in the North West, said:

“The North West has seen a strong performance with a healthy export record, increases in output and orders balances and has strong recruitment intentions for the second half of 2017.

“However to ensure continued growth, we need the Government to deliver a long-term, practical Industrial Strategy for the UK and the Regions with a focus on the mid-market and investing in education, skills and in the North West infrastructure. From better roads, rail links to reliable broadband connections and support for Industry 4.0, the Government needs to help deliver the Northern Powerhouse ambition so North West manufacturers can continue to be successful in what will undoubtedly be challenging times in the short and medium term.”

Sam Nicholson, Head of Low Carbon and Manufacturing at the Business Growth Hub, said: “Today’s report reflects the renewed confidence that we are seeing with the small and medium-sized manufacturers that we work with in Greater Manchester. However, many businesses continue to feel stretched and require their people and equipment to do more with less in order to fulfil their order book.

At the Business Growth Hub our team of specialist manufacturing advisors can work with businesses to identify tools to increase capacity and operate more efficiently – at no cost to their business. We have already supported over 150 businesses to increase productivity in the last 12 months and I urge manufacturers to speak to us today to help them meet this challenge.”

Download the EEF/BDO Regional Manufacturing Outlook 2017 at the EEF website

Do you work in the Manufacturing & Engineering industry? We have a dedicated team of specialists who can support you with tailored business support that will increase your productivity. Find out more here: Productivity in Practice

 

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