A new survey has found that West Midlands manufacturers are staying optimistic of their future growth prospects, but are cautious of the possible impact leaving the EU could have on their expansion plans.
The fifth annual Manufacturing and Engineering survey, which collates responses from more than 550 SME manufacturers and engineers throughout the UK, has been compiled by MHA, supported by Lloyds Bank Commercial Banking.
It suggests that nearly three quarters (73%) of companies in the region are positive about their growth prospects in the next year.
However, a note of realism was struck in terms of concerns over the way Brexit negotiations would go, with 42% of companies perceiving this uncertainty to be a barrier to growth.
Aside from these, major concerns remain over the skills shortage afflicting the sector and the apparent lack of support for firms following the demise of services such as the Manufacturing Advice Service and Growth Accelerator.
So far as skills are concerned, 42% of firms questioned said they were hoping to recruit over the next 12 months, but the inability to find skilled staff to do the job remained a major problem for almost two thirds (61%) of those businesses.
The overwhelming majority (96%) of West Midlands companies believe their production costs will rise in 2016/17 due to the increasing cost of raw materials together with higher wages.
As a result, productivity gains are being seen as important in bringing down costs, as 60% of firms have said they wonât be passing the additional costs onto their customers.
Chris Barlow, managing partner, MHA MacIntyre Hudson in BirminghamChris Barlow, partner at MHA MacIntyre Hudson in Birmingham, commented: The outlook for Midlandsâ businesses remains strongly positive in terms of projected growth, although the result of the EU referendum has added uncertainty and affected confidence. The challenge remains â to deliver the projected growth given the difficulties in recruiting the right staff.