Spring 2017-18 Q4 - South West


Welcome to the SWMAS Spring 2017-18 (Q4) South West Manufacturing Barometer report. It provides a vital snapshot of the sector’s performance in the last 6 months and forecast for the next 6 months.

Mapping the trends, views, and confidence of South West manufacturing SME’s, this latest Manufacturing Barometer represents the collective voice of 113 senior decision makers – over 84% of respondents are CEOs, MDs, or Directors.


This quarter, South West SME manufacturers report an anticipated reduction in sales, profits and investment when looking ahead to the next six months compared to the last quarter’s Barometer. The exception to this otherwise somewhat negative view is a marked increase in planned recruitment, indicating longer term confidence.

The special focus topic for this survey was prompted by comments regarding issues with staffing in recent surveys. This time we asked manufacturing leaders to reveal the challenges their businesses face in recruiting and developing their skilled staff. The results particularly highlight where skilled staff are lacking, key issues UK SME manufacturers know they need to overcome, and what help they require to do so.


The Core Trends

Looking back, manufacturers are telling us they had a good six months with those saying they achieved an increase in sales holding steady at around 63% and those increasing profits at 42%. This was supported by a continued increase in those investing in machinery and premises – reported by 49%, the highest figure for nearly three years - and those reporting an increase in staff recruited rising to 47%.

The picture for the next six months is somewhat less optimistic with those expecting an increase in sales dropping significantly from 75% to 65% (returning to levels reported earlier in the financial year) and a subsequent shift in those who believe their sales will fall going from 6% to 10%. This potential softening of confidence is supported by a reported drop from 58% to 50% in those who are expecting to increase investment in machinery and premises.

However, the key highlight this quarter is the increase in the number of manufacturers telling us they plan to increase staff numbers - it climbs to 58%, the highest figure for three years. This does not come as a surprise and reflects the comments we are receiving from manufacturers regarding their concerns around the productivity and availability of skilled people.

Analysis of the key trends and qualitative statements in this quarter’s Barometer also points to the continued ambition amongst UK SME manufacturers. The language used indicates expectations of growth and increased productivity and profitability, although this is balanced by a need for stability and ‘survival’, perhaps a symptom of the current political and uncertain economic climate. This is also linked to clear messages around plans for diversification and looking for new ways of achieving goals – new markets, new premises, new products, product and service development, new machinery, increasing brand awareness, and new staff.


Special focus: People & Skills

The Special Focus looked at where there is a perceived need for skilled staff across departments and at which levels, from shop floor through to director. Perhaps unsurprisingly, leaders identified that they most lack skilled staff within their manufacturing teams, with operational and technical levels most in need. Technical skills in Design ranks next, followed by Sales & Marketing skills, specifically at managerial and operational levels.
Looking at why manufacturers lack skilled staff in these areas, the following concerns were noted:

1. A perceived shortage of skilled and experienced people, linked to the availability or concerns over the quality of previous training
2. Location, often equated with a small pool of local candidates, and people not wishing to commute
3. Cost and quality of recruitment
4. High cost of employment/unreasonable salary expectations
5. Concerns over the attitude, behaviour, approach and commitment to the job

The shortage of appropriately skilled candidates, and concerns over use of external agencies, is balanced by manufacturers’ clearly preferred use of in-house training to develop their existing employees. However, when they do recruit, South West manufacturers are split between using external and in-house recruitment teams – both are more or less equally successful in finding suitable staff.



In conclusion, manufacturers remain resilient, retain 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 business. With a shortage of skilled, able and committed people, the distinct need is still for a wide strategic view of productivity, taking into account people, products and processes. This is perhaps more important as we move ever closer to the new industrial and post-Brexit landscape.

You can download your copy of the Spring 2017 Q4 South West Manufacturing Barometer report below:

2017-18_Q4_Spring_South_West_Results SWMAS.pdf


Productivity 2020

This quarter, the Manufacturing Barometer's special focus is on productivity good practice and the extent to which it is integrated into the culture of UK SME manufacturing businesses. If you are interested in the subject of productivity and improving it in your business, take a look at our Productivity 2020 programme - it aims to help manufacturers increase their productivity by at least 20% by 2020.