West Midlands manufacturers end year on solid ground – EEF/BDO survey
MANUFACTURERS in the West Midlands look set to end the year on a firm footing with output and recruitment intentions continuing their upward trajectory in Q4 2014.
According to the Manufacturing Outlook survey by EEF, the manufacturers’ organisation, and accountancy and business advisory firm BDO, a balance of 32% of companies in the region witnessed an increase in output in Q4,compared to 10% in Q3.
Strong outputs have had a positive impact on the labour market, with a balance of 39% increasing recruitment in the West Midlands. This figure is one of the highest in the UK (only Yorkshire is higher), far exceeding the 12% of firms that had expected to recruit this quarter.
Order books for Midlands manufacturers have remained stable throughout the year, and have not suffered the fluctuations felt in other parts of the UK. In Q4, a balance of 13% of companies saw orders increase, with a similar outlook (14%) expected for Q1 2015.
UK-wide the sector has performed well during 2014 and is on track to achieve 3.5% growth this year, with a forecast of 2% growth in 2015.
The one area of caution, however, is in exports. Geo-political risks, global uncertainty and the weak performance of the Eurozone are contributed to a more cautious look.
Richard Halstead, Midlands region director at EEF, said: “2014 has proved to be a solid year for West Midlands manufacturers. As we steam into 2015 it’s going to be a case of ‘steady as she goes’ with firms viewing next year with a mixture of grit, determination and realism.
“There have been some notable areas of strength this year, especially among sectors relying on demand in the home market. The fact companies having continued to recruit shows they have a positive view of their prospects ahead.”
Tom Lawton, Birmingham-based partner and head of manufacturing at BDO, said: “The results come as welcome news to our regional economy and jobs market.
“Working against the headwinds of poor export markets, the strength and resilience of sector firms have once again shone through this year.
“What’s exciting, yet equally frustrating, is that manufacturers would have even more growth potential if the right support was in place. The Chancellor must do his bit in this week’s Autumn Statement to back businesses looking to invest, recruit and move into new markets.”
