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💸 Manufacturers have spoken, wage inflation is cause for concern

Manufacturing Mondays
Manufacturing Mondays
I’m back - a big thanks to my colleagues David and Anna for holding the pen whilst I was away. Oh, how I’ve missed writing Manufacturing Mondays each week.
And it seems a lot has happened in the last three weeks in the world of policy and manufacturing.
From Manufacturing and Engineering Week to structured engagement with HM Treasury on R&D tax credits, the apprenticeship levy and more - it has been a bust few weeks for UK manufacturing as well as the Make UK policy and campaigns team.
All whilst we heard from members the big issues we raised pre-spring statement are continuing to impact UK manufacturers up and down the country.
In fact, it was the central message in our Q2 Regional Advisory Board round which came to an end this week. We cover the key takeaways from those below, but as one member aptly summarised “… uncertainty is becoming baked into our expectations”.
Happy Monday…

Regional Advisory Boards
Our Q2 Regional Advisory Boards came to end, and it’s fair to say the difference between Q1 and Q2 feedback was stark. The somewhat optimistic outlook for 2022, with manufacturers seeking opportunities, has tempered.
Many are now facing a summer of persistently high energy prices, spiralling inflation and labour shortages.
⚡ Energy prices continue to hurt manufacturers. With no sign of this tailing off or reducing, manufacturers are taking active steps to reduce consumption where possible.
💷 Wage inflation is making recruitment and retention hard. With fewer people economically active, it seems everyone is competing for the same talent. Manufacturers spoke of the difficulty to keep pace with wage inflation, even though some are paying 15-25% above the average!
On-going supply chain issues. There continue to be some challenges in sourcing raw materials, and with supply chains still recovering from the pandemic. As a result, some manufacturers expressed concern in being able to meet current orders.
On 20th June we’ll be releasing our Q2 Manufacturing Outlook in partnership with BDO which will look at the impact of these significant external shocks. Keep your eyes peeled for those numbers.
Good business pays
These last few years have tested the resilience of manufacturers across the UK who have undoubtedly stood up against each challenge they have come across time and time again.
Each crisis has hampered business’ cashflow to a point where liquidity is often more scarce and limited.
No less so because of late or longer payment terms which Make UK have found to have worsened in the last few years. These days manufacturers are waiting longer to receive payments on their goods and services which negatively impacts small businesses more. It is time to bring this issue to the forefront.
Make UK supports the Good Business Campaign #PayDontDelay
Make UK supports the Good Business Campaign #PayDontDelay
We are delighted to be working with Good Business Pays, the Small Business Commissioner as well as other Business Organisations to raise awareness of the significant challenges that arise as a result of late payments across the industry and get more businesses to adhere to prompt payment standards.
Calling all MPs
Hosted by Mark Pawsey, on Tuesday we are hosting a drop-in session for all MPs to learn about the contribution the UK manufacturing sector makes to the UK economy.
This couldn’t be more timely with the need for a strong industrial base to drive economic growth, front and centre of political minds.
We’ll be sharing:
  • the footprint of manufacturing based on our exclusive constituency data;
  • how the industry is leading the UK economy’s transition to net-zero; and
  • how manufacturers are already playing a crucial role in levelling up the UK.
📅 Join us between 1-3pm in the Attlee Suite, Portcullis House and become a manufacturing champion.
Make UK Become a Manufacturing Champion with Make UK
Make UK Become a Manufacturing Champion with Make UK
ICYMI
Head of Policy at Make UK Modular, Steve Cole, spoke to Explore Offsite about the creation of Make Modular as the new trade body for Modular housing. He shared how Make UK Modular members are transforming housebuilding through greener, faster and better homes.
Offsite Magazine Issue 32 by Radar Communications
And no we didn’t forget… The PM’s housing speech didn’t quite include the progressive solutions we were seeking, namely using modular and volumetric housing to help meet the growing demand for homes.
In fact, we made this precise point in our submission to the House of Lords Committee on Land Use in England. We argue that more land needs to be released for development where it is needed and modular, which can deliver more houses and faster, needs to be prioritised to speed up housing delivery. 
In addition modular can help us meet our green agenda, by producing the greenest homes built at scale in the country, including the first zero-bill houses and estates of zero-carbon homes.
🗝 Modular holds the key to meeting net-zero and speeding up housing delivery.
Art 🤝 Manufacturing
Shoutout to Make UK member CNC Robotics for sharing this incredible video of art in manufacturing by Liz Wilson - who explores the stretch of time between the industrial and post-industrial; In particular the beginning of automation and how this is altering our relationships with technology.
ART IN MANUFACTURING | LIZ WILSON
ART IN MANUFACTURING | LIZ WILSON
We 💚 policy and manufacturing, so let’s talk:
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📧 Email
💬 LinkedIn
🔗 Linktr
Copy editor: Bhavina Bharkhada, Make UK Head of Policy & Campaigns
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Manufacturing Mondays
Manufacturing Mondays @MakeUKCampaigns

We discuss the big issues impacting the UK manufacturing sector, and our policy ideas to overcome them.

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