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18 July, 2018 - 16:17 By Kate Sweeney

East of England region’s manufacturing base, jobs and exports grow

An upbeat new report shows that the manufacturing sector in the East of England is growing its company numbers, headcount and exports and making a crucial contribution to the national economy.

The report – from EEF, the manufacturers’ organisation, and accountancy and business advisory firm BDO – shows that the number of manufacturing businesses in the East of England has grown by two per cent in the last year alone, with the sector now employing almost a quarter of a million highly-skilled people.

The report shows that the industry now accounts for 11.6 per cent of the regional economy. The East of England’s output and order balances have continued to grow solidly over the past year, driven by a robust export order pipeline. 

In line with the broader manufacturing trend however, average balances were tempered by a weaker second quarter in 2018 as momentum in the region begins to ease.

Food and drink manufacturers – the region’s largest sector – faced some difficulties from poor weather at the start of the year, but this is not expected to see growth decline substantially given the resilience of food and drink products to demand fluctuations.

Positive global demand conditions, combined with a weaker sterling, have boosted exports in the region.

The East of England now accounts for 9.3 per cent of total UK manufacturing exports, which is slightly above the average for all UK regions. 

The region does however depend significantly on Europe and, in particular, the EU for exports and is likely to be impacted disproportionately by any ‘hard’ Brexit as a result. Asia accounted for almost 16 per cent followed by the United States at just under 15 per cent.

Charlotte Horobin, region director for EEF in the East of England, said: “The report shows that industry continues to have an increasingly vital role to play in the East of England. The last year has seen a strong performance with lofty heights being reached in the second half of last year and it is no surprise to see some easing back in the first half of 2018.

“There are well documented challenges going forward, not least those facing the automotive and construction supply chains. Furthermore, the progress of Brexit negotiations has the potential to be a factor in the future performance of manufacturers in the East of England. 

“Despite this, those companies that invest and innovate will still have the best long term prospects and can contribute to raising the productivity performance of the region and the UK as a whole.”

Keith Ferguson, partner at BDO in the East of England, added: “Local manufacturers have delivered another strong performance. Manufacturing is a real powerhouse sector for our regional economy, creating jobs and opportunities in both domestic and international markets.

“It is crucial that the Government delivers a long-term, practical Industrial Strategy to ensure a positive trading environment for businesses post-Brexit. Importantly, this will give firms the confidence to continue to invest in automation and digitisation which is so important to the future of UK manufacturing.”

• PHOTOGRAPH SHOWS: Charlotte Horobin

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