British manufacturers have called on the Treasury to provide more urgent support in the midst of poor economic prospects to help “deal with the immediate storm”.
Make UK, the manufacturers’ trading body, and the BDO consultancy found that costs continued to rise and production opportunities had drowned.
A survey found that two-thirds of businesses (67.8%) said rising energy costs were causing catastrophic or significant disruptions. Meanwhile, 71.9% said the rise in raw material costs posed a similar threat and 66.8% had been affected by rising transport costs.
Finding talent has also proven to be a challenge for companies, with vacancies at record levels, with 4.1 places per 100 jobs.
Although the chancellor said earlier this year that he would offer support to the sector in the autumn, Make UK warned that help was needed before the summer parliamentary recession so that companies could “face the immediate storm”.
Make UK made a number of recommendations to the government, such as waiving or reducing trade rates over the next 12 months and reviewing the effectiveness of business loan plans implemented during the coronavirus pandemic.
Richard Austin, BDO’s chief manufacturing officer, said: frozen investment plans.
“There are now strong arguments for government action to help UK manufacturers weather the immediate storm and encourage investment for long-term growth.”
Stephen Phipson, CEO of Make UK, said: “Clearly, some of the factors affecting companies are global and only the UK government cannot contain them.
“However, just as it is taking reasonable steps to protect the less well-off, given the pace at which companies are burning their balance sheets just to survive, it must take immediate action to help protect companies from Worst Impact of Climbing Costs and Help Protect Jobs
“The government acted quickly to implement the permit plan two years ago; it would be a wasteful investment if the jobs saved then are lost now.”
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A government spokesman said: “We continue to support our manufacturers, even through the tax system with the annual investment bonus and super deduction, the largest corporate tax cut in modern British history.
“This adds to an increase in the employment subsidy, a reduction in the fuel tax, and an expansion of programs for energy-intensive industries to help manufacturers with higher energy bills.”
The survey of 287 companies was conducted between May 16 and June 6.