It’s not all doom and gloom within the world of manufacturing in the UK. Anything but.

Experts might believe industry in Britain is still lagging behind when it comes to embracing new technology, but manufacturers are confident of delivering improved productivity in the next two years.

The 2014 Growth Report, from investment firm Albion Ventures, suggests three-quarters of manufacturing businesses are confident of increasing productivity thanks to improved market conditions.

And on a regional basis, the figures stack up too. It’s reported that 90 per cent of SMEs in the North West of England are confident about increasing their productivity.

Patrick Reeve, managing partner at Albion Ventures, said: “The economic recovery may have resulted in steep falls in unemployment, but so far there has been little movement in the productivity needle.”

It all sounds positive with domestic demand helping the UK’s manufacturing upturn continue in November. New data shows that further expansion of output, new orders and employment are predicted.

Manufacturing production rose for the 20th successive month in November, according to the Markit/CIPS Purchasing Manager’s Index, which reached a four-month high. Companies have been increasing output in response to improved inflows of new work.
The reasons behind the increase are quite straightforward according to the industry experts. Solid domestic market conditions, promotional activity and new client wins were all factors driving the latest rise.

Even better news for the economy is that with output and new orders increasing in the consumer, intermediate and investment goods sectors, manufacturing employment also increased, with the sharpest increases among SMEs.

However, whilst the trend in new export orders was not as positive, as companies faced a combination of subdued global market conditions and a relatively strong sterling-euro exchange rate, industry experts believe Britain is still lagging behind when it comes to embracing new technology and the benefits of robotics.

The situation is being addressed with individuals claiming a change in policy by government to encourage companies to invest could be a starting point.

Tony Hague, managing director of Cheslyn Hay-based PP Electrical Systems believing a change in policy by government to encourage companies to invest could be a starting point and bring us closer in line with international rivals.

He claims that a greater focus on improving R&D incentives, a tax system that encourages and rewards capital investment and changing the current depreciation rules on capex that would allow a reduced financial burden – spread over a longer period of time – would help.

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