Stark statistics from the Office for Budget Responsibility (OBR) warn that Britain’s manufacturing sector will take one of the biggest COVID-19 hits financially across UK industry with output expected to fall by 55% in the second quarter of this year.
Previous levels of output can only return with the creation of demand from the reopening of all retail outlets including vehicle facilities to boost automotive, and for nervous consumers to get back to normal spending patterns to provide a market for the goods produced right down the manufacturing supply chain.
As MAKE UK publishes its 3 point plan - Manufacturing our road to recovery - we call on Government to allow manufacturers the time to scale up operations and recover by extending the Coronavirus Job Retention Scheme in a more flexible form - utilising part time or short time working patterns - during the critical rebuilding phase.
This would work in tandem with a series of other measures to stimulate demand to truly get manufacturing and the UK’s economy back on track.
Make UK Chief Executive, Stephen Phipson, said: “Industry welcomed the initial critical financial support from Government but now as we move into the recovery stage the right response is to focus on supporting the business sector with measures designed to stimulate demand and ensure manufacturers can get back to supplying the goods consumers want and our country needs.
“We are calling for a flexible recalibration rather than a cliff edge shock by allowing the Job Retention Scheme to continue its support but in a way that enables manufacturers to get back to work in a way that lets them recover as they bring staff back as order books grow and production levels and supply chains to return to normal.
“It is likely that an immediate end to the JRS for manufacturers, timed simply to coincide with the easing of lockdown arrangements, would be highly premature and could have devastating effects on employment levels within manufacturing. A more sophisticated, flexible and tapered approach to this funding would have a huge positive impact on confidence and help ensure that the sizeable national investment already made in the JRS was maximised and not wasted.”
You can download the Manufacturing our road to recovery document at the top of this article.