Manufacturers in Yorkshire and the Humber have seen a strong performance as the year-end looomed.
The latest quarterly Manufacturing Outlook survey from Make UK and business advisory firm BDO said total orders performed strongly at +38 per cent, “a very strong figure” by historical standards.
It was buoyed by strong domestic orders, although overseas work also remained strong as a reflection of world markets which have rebounded throughout the course of the year.
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The region has benefitted in the second half of the year from a strong recovery in the food and drink sector as hospitality has re-opened, while demand for steel has remained very high on the back of significant investment in infrastructure projects in the UK and abroad.
As with the national picture, the big challenge for companies - in addition to attracting and retaining talent - remains the escalating inflationary pressures which are forcing companies to raise prices, in many cases significantly.
Make UK has forecast growth for manufacturing in 2021 of 6.9 per cent, down slightly from an earlier figure of 7.1 per cent, and growth in 2022 of 3.3 per cent.
Fhaheen Khan, senior economist at Make UK, said: “While manufacturers in Yorkshire and the Humber will be able to enjoy some festive cheer this year, their spirits will be tempered by the eye-watering impact of escalating cost pressures which are leading an increasing number to pass these on to the consumer.
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“Given the global nature of some of these pressures there is little sign that they will abate anytime soon. However, they will hope as we enter a fresh year that these will gradually unwind, with the compensation being that demand prospects among their major markets continue to look strong.”
The performance is reflected in the jobs outlook across the region which is above the national average as companies hire to meet demand. Investment intentions are also above the national average, understood to be buoyed by the extension to the Annual Investment Allowance in the Autumn statement.
Steve Talbot, head of manufacturing for BDO in Yorkshire, said: “Manufacturers faced a brutal 10 per cent decline in output in 2020. This year, they have rebounded proudly with some record-breaking figures.
“Cost pressures – input prices, labour, logistics and inflation – are settling in for the long haul and will continue to impact manufacturers, however they can enter 2022 on significantly firmer footing than last year.”
