Chancellor Rachel Reeves is preparing to unveil her second Budget amid significant challenges, including concerns from industry leaders about the future of the manufacturing sector. She’s pushed back plans to increase income tax. Now, she needs to chart a course through an unpredictable mix of increased expenses and a shortage of workers.
Gerry Dunne, a director at Pre-Met in Redditch, Worcestershire, echoed the fear shared by the wider manufacturing sector. He stressed that “the entire industry” is concerned about what regulatory changes may be coming down the pipe. In the past several years, Pre-Met’s demand for its parts has sharply decreased. That drop is noticeable in the U.S. market as well as around the globe.
The government has been meeting these concerns directly and aggressively. They are following through on a historic £1.2 billion investment to fill the skills gaps in our booming economy. This funding will help to develop 120,000 new training opportunities, an effort that Dunne feels is critical for the industry’s survival.
Dunne told lawmakers that there’s a risk of a ‘brain drain’ as older workers leave manufacturing through retirement without enough young replacements. He stressed the urgency of this issue, stating, “We’ve got an industry that will be struggling with a lack of skilled young people in the medium to long-term.”
The challenges confronting manufacturers go far beyond the workforce crisis. Inflation, driven by high material and energy costs, is quickly rendering commerce as we know it unsustainable. Dunne remarked, “Then we see the rising prices for materials and energy costs, and that begins to make business uneconomical.”
Given the situation, Dunne called on the government to do more, especially in the next Budget. “Not one ‘thing’ will fix everything – but the government can use this Budget to recognise that manufacturing is the backbone of the UK,” he said. He stressed the importance of investing in skills development to guarantee a strong workforce in the years to come.
Hereford & Worcester’s political reporter Tom Edwards has been following this all closely. He is pleased that the federal investment will create more training opportunities. He calls out the need to act urgently, specifically to address immediate concerns for manufacturers.