The Decline of UK Manufacturing
Following all the positivity around manufacturing in recent months, the sector had its weakest month in over two years as the impact of the global economic slowdown and the reality of a no-deal Brexit saw exports decline in August for the first time since April 2016.
This was backed up by the IHS Markit/CIPS latest UK Manufacturing Purchasing Managers’ Index (PMI), which showed that manufacturing growth had hit a two-year low. The PMI dropped from 54 to 52.8, its lowest level since immediately after the Brexit vote, and a weaker than predicated forecast.
Businesses were also further hampered as the prospect of leaving the European Union in March next year without any trade agreement in place started to weigh more and more on the sectors mind. The Sterling weakened against both the dollar and the Euro as a result.
Also, with the rebounding international trade, which helped sustain the global recovery last year fading and the trade war between the US & Europe and the US steel tariffs in place this all added to the challenges manufacturers are facing and had an impact on production.
Taking into account that manufacturing accounts for around 10 percent of the UK’s economy, the slowdown in growth in August is likely to have a negative impact on the economy in the third quarter. This is a big concern for the country and reaffirms the importance of manufacturing to the UK.
However, it’s not all doom and gloom. A number of Norman Broadbent Interim Management’s clients are seeing this as an opportunity and are driving and embracing transformation in order to differentiate themselves and their products from their competition. The main areas of focus by these businesses have been in:
- Innovation and product development
- Technology – specifically to deliver improvements in supply chain effectiveness and customer experience & engagement
As part of this continuing change and transformation, we are being asked by an ever-growing number of our clients to support them as they look to tap into a more diverse range of people and experience, from both inside and outside the sector; not only to deliver change, but also bring an often missed diversity of thought.
If you would like to learn more about how Norman Broadbent Interim Management could support your business, please contact Nick Behan, Director & Head of our Industrial Practice on:
+44 (0) 20 7484 0106