Britain’s manufacturers are calling for urgent action from the Government to deliver a long-term industrial strategy that they believe will transform the sector.
According to the latest Make UK/PwC Senior Executive Survey, such a strategy is seen as a critical step to boost investment, drive productivity, and secure vital skills for the future. Despite rising costs and global challenges, manufacturers remain optimistic about the UK’s competitiveness, with many seeing 2025 as a year of significant opportunity rather than risk.
Nearly 60% of manufacturers say they would increase investment in response to a comprehensive industrial strategy, while 43% believe it would lead to higher productivity and 42% see it as key to addressing the skills gap. This optimism comes as the sector doubles down on innovation, technology adoption, and workforce development to remain competitive in a challenging economic environment.
Manufacturers Back Innovation and Technology Adoption
The survey also reveals a sector-wide focus on innovation and technology. Over three-quarters of manufacturers (78%) are actively developing new products, while 48% are deploying new technologies and 37% are entering new markets. These strategies align with the belief that embracing technology and automation will help counter rising operational costs and improve efficiency.
Stephen Phipson, Chief Executive of Make UK, commented:
“Manufacturers have demonstrated their resilience over and over again in recent years and, despite the numerous challenges they face, those that remain innovative and are prepared to invest in new technologies, expanding markets and, most crucially, their people will continue to thrive. But they can only do this if they are operating in the most favourable business environment, and there is little doubt that the next twelve months are set to be immensely challenging in a complex international environment.
“To help companies navigate these challenges, it is now vital that Government sets out as a matter of urgency the immediate and significant priorities as part of its formal industrial strategy. By doing this, it will help re-boot business confidence and ensure the year gets off on a positive footing in terms of the relationship between industry and Government.”
Cara Haffey, Leader of Industrials and Services at PwC UK, added:
“While it's true that UK manufacturers are navigating a complex business landscape—compounded by rising costs—there's a palpable sense of optimism and resilience underpinning the sector's trajectory for 2025. This optimism is fuelled by hopes of increasing clarity on the proposed UK industrial strategy, as well as a decisive shift towards technology adoption. The sector is moving from viewing technology as a source of incremental improvements towards acknowledging its power to transform operations.
“Additionally, there's a strong focus on innovation, with companies investing in new product lines and business development to seize growth opportunities. This approach, alongside efforts in product development, upskilling, cost management, and embracing technology, positions manufacturers well to navigate challenges and contribute significantly to national economic growth.”
Economic Challenges Persist
Despite the optimism, manufacturers face significant economic pressures. Over 90% of companies expect employment costs to rise in 2025, with more than three-quarters anticipating higher business taxes (76%) and logistics costs (72%). In response, Make UK is urging the Government to introduce measures to reduce business rates, as well as incentives for decarbonisation and energy efficiency, to support manufacturers in meeting these challenges.
As the Government considers its formal industrial strategy, the message from manufacturers is clear: decisive action and long-term planning are essential to ensuring the sector’s growth and resilience in an increasingly complex global economy.
Image: Getty Images.