MHA | Manufacturing sector ready to bounce back, says advisor

Manufacturing sector ready to bounce back, says advisor

June 5th 2024
Manufacturing and welding

The manufacturing sector is ready to bounce back strongly, but more action is needed to get businesses investing for long-term growth.

That’s according to our manufacturing sector partner, Ginni Cooper, who was commenting as the latest data shows the UK manufacturing sector returned to growth in May, with output expanding at the quickest pace in over two years.

The S&P Global UK Manufacturing Purchasing Managers’ Index (PMI) rose to 51.2 in May, up from 49.1 in April, its highest reading since July 2022. Positive sentiment rose to its highest level since early-2022, with 63% of companies expecting output to expand over the coming year.

Ginni Cooper, partner, said:

“Manufacturing PMI has held above 50 for two out of the last three months which means the sector is heading in the right direction.

“However, ongoing concerns about high interest rates are stifling the flow of money into our manufacturing clients and the continued uncertainty around when UK interest rates might be cut means that businesses remain reluctant to invest.

“After some of the challenges of the last few years, the announcement of the general election and the relatively short period of campaigning is welcome news for the manufacturing sector, as after 5 July there will be some certainty at last for business, whichever party is in power.

Ginni, who advises manufacturing and engineering companies, added: 

“The manufacturing industry is looking to the next government to introduce a long-term industrial strategy to drive growth, which is critical to re-energise the sector.

“Any plans will need to look at investing in skills as well as infrastructure which will allow manufacturing businesses to be proactive and look forward to the future rather than just being reactive.”

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