London – After months of severe business declines, UK chemicals manufacturers are now reporting stability or improvement, according to the Chemical Industries Association (CIA).
In its latest quarterly survey of CIA member companies, about 50% described second-quarter exports as well as capital expenditure as either steady or improving.
Furthermore, around 80% of companies reported stability or growth in employee numbers as well as in the amount being spent on R&D, the association reported 5 Aug.
“Given the huge challenges earlier in the year, it is good to see some stability has been reached,” commented CIA chief executive Steve Elliott in a release.
Looking to the next three months, 70-80% of businesses see stability and improvement in domestic sales and exports and capital expenditure.
Only 10% of respondents reported potential job losses and R&D expenditure reductions in the quarter.
Elliott was cautiously optimistic about the survey findings, saying the next quarter “looks OK,” although the industry is not on an economic growth path.
In their 12-month outlook, companies were more optimistic, with a 52% majority predicting “an even stronger export performance.”
Some 75% of respondents anticipated the ramping up and stability of new orders as well as increase in production levels, jobs and R&D.
Despite the positive outlook, the CIA boss warned that a sustained economic recovery was “unlikely to be smooth or predictable” – considering current challenges.
“The uncertain outcome of the Brexit talks, and any Covid-19 spike means the tremendous hard work shown by businesses in the sector could be at risk,” Elliott stated.
In a call to the UK government, Elliott said industries needed a “tariff-free frictionless trade” with the EU, taxation reform through a reduction in corporation tax and incentives for R&D.
“Now is the chance for the government to set a clear business agenda for the future that creates investment opportunities across the whole of the UK and the chemical sector,” he concluded.