Belfast Telegraph

Brexit primary concern for Northern Ireland manufacturing firms, study shows

Stephen Kelly, chief executive of Manufacturing NI
Stephen Kelly, chief executive of Manufacturing NI
Ryan McAleer

By Ryan McAleer

Manufacturing companies in Northern Ireland have said they are growing staff numbers and increasing sales while reporting Brexit has become their biggest concern for the future.

According to a new survey from Manufacturing NI and law firm Tughans, 67% of businesses now rank Brexit as their main concern, ahead of costs and the political climate in Northern Ireland.

A total of 122 companies took part in the December 2018 survey, which reflected a series of positive indicators despite growing trepidation over the UK's withdrawal from the EU.

Four in five firms described their business as growing, with 74% reporting an increase in sales in the previous 12 months. That compares to 57% in the last survey conducted in May 2018.

More than half (57%) increased their workforce over the year, while 89% reported a profitable 12 months, up from the last manufacturing survey (81%).

But as Brexit day draws closer, the survey reflects more pessimism and less optimism over the impact of leaving the EU.

Half of the 122 firms surveyed said Brexit will have a negative impact on businesses, up from 41% in May 2018.

Any optimism over a potential positive windfall appears to have dwindled. In December 2017, one in five businesses (21%) predicted a positive impact from leaving the EU. That figure dropped to 11% in May 2018 and stood at just 6% last month.

Meanwhile, 58% said they had either started stockpiling or intended to start owing to concerns around possible disruption to supply chains during March and April.

Stephen Kelly, chief executive of Manufacturing NI, said "very few" members were convinced of any of the arguments put forward in favour of Brexit, particularly by those promoting a no-deal exit.

"These are people who understand the practicalities of trading in markets at home and abroad. Those who want Brexit to be a success need to start listening to these businesses or face the prospect of job losses," he said.

The shortage of skilled workers remains a problem for many manufacturers. Just under 90% said they had been trying to recruit over the year, with 81% reporting difficulties doing so.

One in five (21%) said they had been forced to turn down potential new businesses opportunities or orders.

The shortage appears to have driven more firms toward machines, with 52% of firms reporting they have speeded up plans to increase automation.

Mr Kelly said the figures were "startling".

In addition, 37% of firms asked said that the number of migrant workers in their employ had dropped in the past year.

Just 12% reported the same in May last year.

The Manufacturing NI chief executive said a new migration policy under Brexit will further restrict the ability to recruit.

Belfast Telegraph