2016 a year for tough decisions says EEF
UK manufacturers’ organisation EEF says 2016 will be a year of tough decision.
According to this year’s annual EEF/Aldermore Executive Survey, UK manufacturers expect 2016 to be a year of tough decisions and more prominent risks.
This adds up to another year of concern for manufacturers, with four in ten expecting global economic conditions deteriorate further through the year, with lea than a quarter expecting conditions to improve.
They are, however, more positive about conditions closer to home with a third of respondents saying an improvement in industry and UK economic conditions is on the cards, outweighing those expecting conditions to take a turn for the worse.
Investing in technology
Over half of manufacturers expect to increase productivity, while over four in ten expect to boost UK and export sales. To support growth, their main focus will be on increasing investment in technology and innovation, selling into new export markets and collaborating with customers and suppliers to ensure supply chain flexibility.
Whilst proactively planning to help shield themselves from the impact of economic factors and to deliver growth, it’s also clear that manufacturers are aware that tough conditions can mean tough decisions. As a result, organisational changes, workforce restructuring and ‘across the board’ cost-cutting all feature on manufacturers’ list of company priorities for the year ahead.
Pressure on business costs
Global economic volatility is a key driver, with manufacturers identifying significant movements in exchange rates, economic volatility in a major market and uncertainty around the UK’s place in the EU as the top risks they face this year. At the same time, over a third of manufacturers see upward pressure on business costs as a possible risk to growth in 2016, with pressure expected to come from a range of sources.
Terry Scuoler, Chief Executive of EEF, says: “There is particularly good news about the number looking to prioritise investment in technology and innovation and those looking to explore new export markets. These are positive and proactive steps. At the same time, however, tough conditions call for tough decisions – and restructuring and cost-cutting efforts are clearly high on the agenda for some.”
The full report can be viewed here on the EEF website
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