23 October 2017

The Guardian: Brexit fears are holding back manufacturing investment, study finds

The amount invested by UK manufacturers in new plant and machinery has slowed to 6.5% of turnover, from 7.5% last year, according to a survey by EEF, the industry trade body, as companies press the pause button until there is further clarity on a Brexit deal.

Britain’s business community has warned the government that it must urgently agree a Brexit transition deal with the EU or risk losing UK jobs and investment.

“With global demand on the up, conditions should be ripe for industry to make new investments in capacity and productivity-enhancing technology, but Brexit means the future outlook for investment is not clearcut,” said Lee Hopley, EEF’s chief economist.

The 328 companies taking part in the annual EEF/Santander investment monitor were almost evenly split over whether they intend to increase spending in the next two years.

A small majority, 51.1% of manufacturers, intended to spend more on plant and machinery, either to replace obsolete equipment or to take advantage of new opportunities on the back of an improved global outlook.

For the other half, uncertainty over the UK’s exit from the EU was holding back planned investment, while there was also little focus on investing to improve process efficiency. [...]

Full article on The Guardian

EEF Investment Monitor 2017/18

© The Guardian