UK manufacturers worry about bigger risks in 2017

More manufacturers expect 2017 to be a year of increased risks and declining economic conditions, according to a survey of the industry.

Almost half of industrial bosses, 46% of the total surveyed by the EEF manufacturer's body, said their company faces more risks than opportunities in 2017, while 47% expect UK economic conditions to decline, a substantial increase from the 28% that had the same view a year ago.

Taking a more optimistic view were just 23% who said opportunities outstrip risks.

Despite this, most firms remained fairly confident about most conditions in their industry, with permanent employees, UK sales, exports and productivity all predicted to head in the right direction.

Indeed, more than half, 56%, expect to increase their productivity while half expect to boost UK sales. Four in ten firms also expect to see improvements in export volumes, majority of which is expected from non-EU countries at 43%.

Manufacturers continue to be ambitious with their business plans with the biggest challenge for the new year being diversifying into new export markets.

Many acknowledge the amplified risks posed by Brexit but over six in ten still view the UK as a competitive location for their activities, up from 56% last year.

"Global political upheaval means that 2017 looks set to be another bumpy ride, with manufacturers forced to navigate uncertainty, unpredictable economic conditions and a number of risks that have been amplified by Brexit," said EEF chief executive Terry Scuoler.

"Against this backdrop a smooth journey is far from guaranteed, but firms are strongly attuned to the challenges and remain fully focused and determined to deliver on their long-term plans for growth. With a new digitally-driven industrial era on the horizon and everything to play for, this long-term vision and focus is vital - despite the peaks and troughs manufacturers cannot afford to be diverted away from where they need to be.”