London – Business confidence among UK manufacturers’ has fallen sharply following the European referendum, according to a new report from manufacturers’ organisation the EEF, and BDO, an accountancy and business advisory firm.
According to the report, issued 29 July, every region suffered a decline in optimism with the biggest falls recorded in north east England, London and Wales.
The annual Regional Manufacturing Outlook report used survey data and the latest Office for National Statistics figures on the current status of the UK manufacturing sector.
Average confidence, it found, scored 6.37 out of a possible ten points just before the referendum, but slumped to 5.24 after the vote.
In the North West, a quarter of companies were unable to yet identify any business opportunities from Brexit - worse than any other region.
More companies, there, were concerned about weaker demand prospects (59 percent) and the attitude of their parent company following the referendum (28 percent) than elsewhere in the UK.
In the east Midlands, 19 percent of manufacturers said they would immediately review UK recruitment, UK investment (16%), overseas investment (11%) and the country location of their operations (10%) - higher than in most other regions. Local manufacturers are also more concerned about exchange rate volatility (84%) and increased costs (66%) than those in other regions.
EEF chief economist Lee Hopley, said: “The referendum outcome has provided a jolt and it’s clear that there are fresh challenges ahead. Exchange rate volatility, political uncertainty and the danger of increased costs are already causing concern across the regions and business confidence is in short supply.
"But our sector is nothing if not dynamic, determined and resilient. UK manufacturing remains a force to be reckoned with.”