Skills, costs and Brexit combine to threaten automotive growth

The worsening skills crisis, increased labour and parts costs, and the uncertainty of Brexit are combining to threaten growth in the UK automotive industry, according to the latest survey on employment prospects for the car industry.

But despite the bumps in the road, more than half of Midlands manufacturing and engineering firms expect to take on extra staff this year, even though they see the skills shortage and uncertainty over future UK visa policy as potential brakes on their acceleration plans.

The findings are revealed in the 2017 Automotive Manufacturing Salary Survey, conducted by Midlands-based engineering recruitment firm, Consilium Recruit.

Surveying a cross-section of automotive manufacturing and engineering employers across the region, the survey found that 46% of firms expected to take on more people this year.

This is a drop on last year’s figure of 52%, which is said to reflect increased uncertainty after the Brexit referendum. Manufacturers are also concerned about the additional labour cost burdens of the Apprentice Levy and the National Living Wage, and increased parts costs caused by the weakness of the pound.

The employers, including major manufacturers, suppliers, motorsport companies and support businesses, say lack of skills is threatening growth.

Consilium Recruit business development manager Paul Gunnell said there was cautious optimism for modest but sustained growth in the automotive sector but the shortage of engineering talent was continuing to preoccupy the industry.

“With severe skills shortages across manufacturing and engineering at an all time high the Government needs to clarify visa policy so that growing firms can not only attract much-needed global talent into the UK workplace, but can also assure those already domiciled here that they are welcome to stay,” he said.

“The uncertainty over the future of the UK’s Vauxhall plants and its suppliers after the PSA takeover adds another layer of concern to the mix.”

Consilium Recruit was formed in 2001 by a group of engineering and manufacturing professionals. The company has placed workers into a variety of leading UK and European businesses, with clients including Jaguar Land Rover, McLaren and Bosch.

The 40-employee firm has offices in Stratford-upon-Avon and Stourport.