Covid-19 to halt manufacturing growth until 2022
By World Infrastructure Journal-
It could take two years for the manufacturing sector to recover to its pre-Covid growth track, potentially costing £35.7 billion in Gross Added Value this year alone, a new report by Make UK has revealed.
According to the report, digital, global and green initiatives will become central to aiding recovery, forming a repurposed industrial strategy to help turbocharge manufacturers.
The first detailed analysis of the Covid-19 impact on UK manufacturers: ‘Responding, Re-setting and Re-inventing UK Manufacturing Post Covid’ sets out the scale of the challenges ahead for the sector.
The report also highlights how quickly manufacturers responded at a time of national crisis – from filtration specialists who’ve turned their hand to creating personal protective equipment (PPE) to signage firms diversifying their products to create social distancing signage for customers across Europe.
The report predicts that the sector will be at the forefront of helping the UK meet its net-zero carbon target through a mix of investing in green, sustainable processes and maximising the use of digital technologies. However, it also says that this can only happen through a re-purposed industrial strategy involving a partnership with government.
Commenting on the report, Stephen Phipson, Chief Executive at Make UK, said: “A new digital, greener and more sustainable economy will emerge from this with an opportunity to catapult manufacturing, science and engineering once again to centre stage in the UK. Industry stands ready to work with the Government to produce a new industrial vision which will benefit all regions of the UK. ”
The report stresses the need for the industry to embrace digital transformation which “must now be a national strategic priority with the creation of a National Skills Task Force. ”
Paul Brooks, Head of Manufacturing at Santander, said that it would be crucial to look at new overseas markets to diversify and minimise overreliance on a single export market for UK manufactured products. “While Covid-19 presents the most testing time for manufacturers at both ends of the supply chain, their aptitude to handle shock and change for the better is enduring, and we stand ready to support them,” he said.
- Industry GVA to fall from £185 billion to £149 billion
- A third of SMEs and two-thirds of large companies source components from China
- Over half of companies have reviewed supply chains, further third intend to do so
- A four-point plan focusing on digital and zero-carbon will help aid recovery
The report is available here
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