Following the release of the latest UK manufacturing PMI on 2 October, Richard Powell, partner at accountancy firm MHA, believes that despite recent improvements in market stability, the government must provide manufacturers with clarity over future incentives if it hopes to see businesses invest in growth strategies.
“A more stable economic environment, receding inflation and lowering interest rate have provided manufacturers with much need respite. As a result, rising sector confidence is facilitating better-informed investment decisions and providing businesses with a semblance of certainty to plan for the rest of the year.
“Nevertheless, it's still early days, and these positive indicators might be short-lived. Projected fuel price increases and lingering uncertainties surrounding government investment, especially in areas like HS2 and green initiatives, cast shadows of doubt for business leaders.
“Manufacturers require certainty, whether in economic metrics or government direction, to pursue their strategic plans and investments confidently. Without this assurance, businesses may water down their growth strategies, stifling greater sector investment and growth.
“Despite reasons for optimism, the PMI could easily remain below 50 for the rest of the year as it has done for the last 12 months already reflecting ongoing operational challenges. Manufacturers must tread cautiously, staying vigilant in this unpredictable landscape, adapting swiftly to changes in economic conditions and government policies.”