Two-thirds of small and medium-sized manufacturers expect to increase investment in new technology, machinery or premises to increase productivity over the next six months, and 80 per cent believe efficiency games are necessary to remain competitive.
The Manufacturing Advisory Service Barometer found more than half of manufacturers recorded an increase in sales for the sixth successive quarterly report, with 67 per cent expecting to grow between now and the end of March 2015.
Improving market conditions are reflected in hiring plans, with 95 per cent of firms surveyed planning to either maintain or increase their workforce over the next six months.
Roger Tyler, managing director at Blink Medical, said the company has increased staff by 20 per cent over the last 12 months. Tyler added he thinks smaller manufacturers can be more productive than their larger peers because focus they can more acutely on each staff member’s contribution.
Food manufacturers led the industry, with 85 per cent planning to invest to increase productivity. Pharmaceutical and aerospace were in joint second place at 83 per cent.
Steven Barr, head of the Manufacturing Advisory Service, said: Our barometer shows that manufacturers are already responding to recent observations by the Bank of England that productivity needs to be raised.
Alex Reihl, managing director of G plants, said retail discounters and high-end garden centres are experiencing growth, in spite of economic conditions: We have invested 600,000 in new machinery and taken on several staff. This will continue over the next two years.
Large companies are inflexible and slow to react to changes in consumer demands. [However] in terms of our sector, the UK market is very conservative and retail buyers at store groups are reluctant to open their ears to smaller companies.
The MAS Barometer includes 859 small and medium-sized manufacturers across England, which employ over 20,000 people, claiming to be the largest survey of its kind.