Manufacturing News – April 2017

Almost two-thirds (65%) of UK manufacturing business Invested in automation over the past 12 months, according to the latest Annual Manufacturing Report. The report also reveals the majority of those executives surveyed represent companies which are already undertaking a move to Industry 4.0 (23%) or were planning to do so (62%). More than half (51 %) of those investing in automation expect to redeploy existing staff to perform more profitable roles within the organisation.


Manufacturers are leading the way when it comes to advanced technology, employing it to transform every process and operation. Cloud computing, 3D printing, the Industrial Internet of Things, augmented reality, advanced robotics, cyber-physical systems, artificial intelligence, machine-learning, digital factories. These advancements are all a reality today, and the people who use them are skilled, creative and at the cutting-edge.



UK firms want to recruit more workers but cannot find or afford the right staff, a survey has found. The British Chambers of Commerce (BCC) spoke to 7,300 businesses in the manufacturing and services sectors, and found the percentage seeking to hire had grown by up to 9% in the last quarter. Most also experienced “high levels of recruitment difficulties” which the BCC said was a risk to growth.


According to the trade group’s quarterly economic survey, both manufacturing and services firms reported “solid growth” in their businesses in first three months of the year, with domestic and export sales up since the previous quarter.


It also found “confidence in turnover and profitability is improving”, and that some 86% of manufacturing firms, up from 77% in the last quarter, and 59% of services companies, up from 53%, wanted to find new recruits. Despite this, around 74% of manufacturing firms and 58% of services firms said they were struggling to find staff.


A separate survey by the Federation of Small Businesses has found confidence among small firms has risen to the highest level in over a year, despite spiralling business costs. According to the index, confidence stood at 20.0 in the first three months of 2017 – the highest figure since the fourth quarter of 2015. The FSB said the recovery had been spurred by increased international trade, with 15.6% of small firms reporting a rise in export activity during the past quarter.



Manufacturing and engineering companies are being urged exploit the untapped value in their Intellectual property to avoid losing money on lost designs, systems and patents, and create new revenues. Global trade in IP licenses in 2014 was worth more than £220bn – 1.6% of global trade and rising.


Each year millions of pounds in IPR – intellectual property rights – are being neglected by the UK’s engineering sector, because companies don’t understand them and the IP within their designs and processes, according to the Manufacturing Technologies Association (MTA).


British companies including technology firms and sub-contractors, and UK subsidiaries of foreign-owned companies, are less knowledgeable about the value of their IP, such as patents, design rights and trade marks, compared with those in creative industries, such as gaming and entertainment, the latest MTA study shows.


As well as losing IP to competitors from not registering their marks and rights, manufacturers are losing out on new revenue streams from both licensing out their IP to third parties, and from licensing IP from other parties as an agent, to allow them to use IP owned by others.


UK investment in intangible assets protected by IPRs has risen from £47bn in 2000 to £70bn in 2014, according to the Intellectual Property Office (IPO), partly due to the growth of services like software programming and the knowledge economy. However, manufacturers are missing out and could boost this number significantly.


In 2014 firms in the UK invested an estimated £133bn in knowledge assets, compared to £121bn in tangible assets. The survey showed that while nearly all those surveyed had registered basic IP such as a web domain name (94%), only 45% had registered a patent and just 22% owned registered designs.  65% of those surveyed had never licensed intellectual property from a third party, and 67% had not licensed out IP to other parties, a high proportion for both given the IP-intensiveness of engineering. Also, more than 65% had never made an application to protect their IP outside of the UK.  Over 80% of those surveyed used non-disclosure agreements (NDAs) and almost a quarter (24%) had been involved in a legal dispute involving IPRs, with the UK and the US being the most popular locations for the dispute.



UK manufacturing performance remained solid as the first quarter of 2017 drew to a close, bolstered by a further boost from exports, according to the latest Markit/CIPS Purchasing Managers’ Index (PMI).  Though a slight dip on February’s 54.5 score. March saw UK manufacturing remain above the neutral mark of 50.0 for the eighth successive month.  Despite a contraction in output and new orders, March remained well above the long-run average of 51.6 for UK manufacturing with an overall PMI score of 54.2.


According to Markit/CIPS, the domestic market was a key source of new business wins, alongside the continued weak sterling exchange proving a boon to exporters, both old and new alike.  The survey also demonstrated a positive outlook for the sector, with more than half (52%) of companies forecasting increased production in 12 months’ time, compared to just 6% anticipating a decline.      

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