Yorkshire manufacturers enjoy strong end to the year

Total orders in the region performed robustly at plus 38 per cent, which is a very strong figure by historical standards.

The figure was boosted by strong domestic orders although overseas orders were also healthy, reflecting world markets which have rebounded throughout the course of the year.

Yorkshire benefitted in the second half of the year from a strong recovery in the food and drink sector as hospitality reopened, while demand for steel has remained very high on the back of significant investment in infrastructure projects in the UK and abroad.

The robust performance is reflected in the jobs outlook across the region which is above the national average as companies hire staff to meet demand.

Investment intentions are also above the national average, possibly in response to the Chancellor’s decision to extend the Annual Investment Allowance in the Autumn statement.

As with the national picture, the big challenge for companies is the escalating inflationary pressure which is forcing companies to raise prices, in many cases significantly.

The other challenge is attracting and retaining talented staff.

Make UK has forecast growth for manufacturing in 2021 of 7 per cent and growth of 3.3 per cent in 2022.

Fhaheen Khan, senior economist at Make UK, said: “While manufacturers in Yorkshire and the Humber will be able to enjoy some festive cheer this year, their spirits will be tempered by the eye watering impact of escalating cost pressures which are leading an increasing number to pass these on to the consumer.

“Given the global nature of some of these pressures there is little sign that they will abate anytime soon. However, they will hope as we enter a fresh year that these will gradually unwind, with the compensation being that demand prospects among their major markets continue to look strong.”

Steve Talbot, head of manufacturing for BDO in Yorkshire, said: “Manufacturers faced a brutal 10 per cent decline in output in 2020.

"This year, they have rebounded proudly with some record breaking figures.

“Cost pressures – input prices, labour, logistics and inflation – are settling in for the long haul and will continue to impact manufacturers, however they can enter 2022 on significantly firmer footing than last year.”

Make UK, the manufacturers’ organisation, is the representative voice of UK manufacturing, with offices in every English region, London, Wales and Brussels.

Collectively it represents 20,000 companies of all sizes, from start-ups to multinationals, across engineering, manufacturing, technology and the wider industrial sector.

It directly represents over 5,000 businesses which are members of Make UK.