Unlocking trade deadlock
This year’s Brexit negotiations has extended a period of unprecedented uncertainty for manufacturers and it is hoped by many across the sector that we see some movement towards clarity regarding what trading will look like post-Brexit. Unlocking trade deadlock will allow businesses to plan effectively; take key investment decisions; and expand into new markets to futureproof their businesses in a new trading environment – whatever that looks like.
Combining an ageing workforce with potential labour markets across the EU closing, the skills shortage in the sector could reach acute levels in 2019. It’s basic supply and demand as less migrant workers come to the UK there will be an increase in competition for jobs, with the need for new roles to support digital investment adding to the pressure to recruit the best people. This will not only impact productivity and efficiency, but the additional recruitment costs will apply further financial pressure on the sector.
This could see manufacturers investing in capital improvements to reduce the reliance on workforce and improve productivity; all set against the conundrum of uncertainty which reduces the confidence to invest, so a courageous approach will be necessary.
With uncertainty on home soil many manufacturers are looking towards global markets to maximise favourable exchange rates and secure long-term growth. But with many looking to Europe, the US and Asia markets, macro developments including Brexit and the trade spat between the US and China could make global expansion trickier in the short term. However, trading internationally gives manufacturers the chance to diversify business models, spread risk, access new customers and find greater returns, so 2019 could be the year for thinking global.
If you're interested in thinking global in 2019 then find out more with our manufacturing for global markets report.
Keep calm and carry on
Now, more than ever, Britain needs to capitalise on the high acclaim that a Made in Britain badge holds and maximise global opportunities. Despite uncertainty, manufacturers are resilient; and in unfavourable trading conditions the heart of the UK economy will innovate and thrive – building on an already impressive manufacturing base the sector will keep calm and carry on.
If you're interested in what RSM can do for your manufacturing business in 2019 then why not discover more about how we can help you.