Business

Over half of local manufacturers set to recruit this year in growing sector

Stephen Kelly, chief executive, Manufacturing NI, Maureen Treacy, Perceptive Insight and James Donnelly, corporate partner, Tughans, launch the 2018 Manufacturing Survey
Gareth McKeown

THE north's manufacturing sector is in rude health, with almost three quarters of firms reporting growth in their business, according to new research. The Manufacturing NI and Tughans survey, which covers companies across all 11 council areas in the north, has revealed a flourishing industry, which is not only creating jobs, but offering wage hikes above the rate of inflation.

The latest data shows that 72 per cent of respondents believe their business is growing, with 55 per cent expecting this to continue for the next 12 months. A total of 45 per cent of firms surveyed reported an increase in staffing levels and more than half (55 per cent) expect to take on more workers this year. In relation to pay,

68 per cent of respondents said they delivered wage increases between 2 and 5 per cent during the year, with four in 10 planning to do so in the next 12 months.

The figures further show that 81 per cent of manufacturing companies have been profitable this year, while 57 per cent reported increased sales, in spite of the ongoing uncertainty in relation to Brexit and the continued lack of a Stormont Executive.

Uncertainty surrounding Brexit is a key factor in business planning according to local manufacturers, with those who export to the Republic particularly concerned in relation to the potential impact on the border. A total of 41 per cent of companies expect Brexit to negatively impact business, with the same number unsure of what the future holds. Only 11 per cent view it as a positive.

Issues including inflation, heavy taxation and VAT also continue to challenge the sector with 60 per cent of respondents also citing pension contributions and the Apprenticeship Levy as amongst their most prevalent concerns.

Manufacturing NI chief executive, Stephen Kelly believes the figures paint a positive picture of the local sector.

"Far from the sunset industry some may think, it shows a vibrant, successful and growing sector making a larger contribution to the economy and jobs and poised to have a bigger impact if we can provide them with the right political, economic and trading environment. There are more and better paid jobs, many reporting inflation busting pay rises, so we would encourage those thinking of a career to get into manufacturing," he said.

In spite of the optimism prevalent within manufacturing, Mr Kelly said more can be done to improve business conditions, including the restoration of local government.

"The resultant stagnation with regard to updating legislation and introducing new policies is causing problems for some businesses. Companies are also experiencing delays with getting new products off the ground and are having to shelve a number of projects until the political climate becomes more stable," Mr Kelly added.

James Donnelly, corporate partner at legal firm Tughans, said recruitment remains an issue for manufacturers in the north.

“it is a concern that skilled workers such as those with engineering and automated manufacturing skills are proving difficult to find. Another reason why this sector, as well as the Northern Ireland economy generally, needs to see local government restored.”

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