English manufacturers want to invest

English manufacturing SMEs are ready to invest, the latest Manufacturing Advisory service Barometer suggests.

Half of the 682 companies surveyed in the study expect to spend more on new machinery and premises over the next six months, a rise of 12% on the same period last year.

53% of respondents reported an increase in sales in the first half of the year, and an all time National Barometer high of 67% predicted further growth over the next six months.

David Caddle, area director for the Manufacturing Advisory Service, commented: “Manufacturers tend to be very cautious and traditionally would have needed significant confidence in the long-term future to relax the purse strings.

“Encouragingly, the latest Barometer provides the clearest indication yet that companies are prepared to invest in new machinery and their premises in a bid to remain competitive and take advantage of significant opportunities both at home and abroad.

“It is a reassuring finding and appears to meet the EEF’s recent call for the sector to fund more research, innovation and export growth.

“This sense of optimism is also present when it comes to employing new staff. 43% of SMEs (up 3% on the last report) are planning to hire new people with a further 50% expecting to keep workforce levels the same. “

Business and Energy Minister Michael Fallon said the results were encouraging for the sector, and the economy in general

82% of respondents reported that new products introduced over the last two years had led to new sales.

Over a third of respondents said new sales accounted for 25% or more of their total turnover.

Mr Caddle added: “The results in this special focus indicates that there is a strong link between innovation and increases in both company growth and profitability.

“This is why being innovative has never been so important for manufacturers. We are helping to encourage innovation in SMEs through our New Product Development programme, which provides support in developing, validating and bringing new ideas to market.”

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