Quarterly Review

March 2020

As we outline our first quarterly report of the decade, we welcome a strong swing to mostly positive indices and review our survey respondents input to what will be one of the key talking points for many years to come: Climate change and the response that industry will take to it.

Chief Exec's report

Key highlights from this quarter:

  • Confidence shoots up from -5% last quarter to +17% this period
  • Forecast orders for the next three months show a net +42%
  • Training investment remains positive at net +8%
  • Staffing remains stable at +2% reflecting available capacity to meet upturn following lower previous quarter output

Order intake has swung into positive territory after dipping for two consecutive quarters. Output volume has dipped by nine percentage points, but still remains positive.
Export levels remain negative but have improved since last quarter and staffing levels have dipped but are still positive

Order intake

Output volume

Exports

Staffing

   

  Net  

  Up  

  Same  

  Down  

UK Orders

-3%

29%

39%

32%

Small companies

0%

29%

42%

29%

Medium companies

0%

33%

34%

33%

Large companies

-60%

0%

40%

60%

Machine shops

-22%

22%

34%

44%

Mechanical equipment

-8%

21%

50%

29%

Metal manufacturing

-12%

38%

12%

50%

Non-metal products

-16%

17%

50%

33%

Fabricators

42%

58%

25%

17%

Electronics

-40%

20%

20%

60%

 

UK orders are negative, with the balance of change at -3% (13% higher than last quarter). Small and medium sized companies are reporting equal numbers of increases and decreases, whilst large companies have moved from a positive to negative position. Within the sectors fabricators are reporting positive returns. Machine shops, mechanical equipment, metal manufacturing, non-metal products and electronics are all reporting negative returns.

   

  Net  

  Up  

  Same  

  Down  

Export Orders

-9%

26%

39%

35%

Small companies

-10%

23%

44%

33%

Medium companies

-9%

29%

33%

38%

Large companies

0%

40%

20%

40%

Machine shops

-60%

0%

40%

60%

Mechanical equipment

12%

36%

40%

24%

Metal manufacturing

-29%

14%

43%

43%

Non-metal products

-40%

20%

20%

60%

Fabricators

-50%

0%

50%

50%

Electronics

-60%

0%

40%

60%

 

Export orders are negative for small and medium companies, and there are equal numbers of increases and decreases for large companies. The balance of change is -10% for small companies, -9% for medium companies, and 0% for large companies. In the sectors mechanical equipment are positive and machine shops, metal manufacturing, non-metal products, fabricators and electronics are reporting negative returns.

   

  Net  

  Up  

  Same  

  Down  

Optimism

17%

33%

51%

16%

Small companies

20%

37%

46%

17%

Medium companies

7%

21%

65%

14%

Large companies

40%

60%

20%

20%

Machine shops

11%

22%

67%

11%

Mechanical equipment

12%

27%

58%

15%

Metal manufacturing

13%

38%

37%

25%

Non-metal products

-50%

0%

50%

50%

Fabricators

50%

50%

50%

0%

Electronics

-60%

0%

40%

60%

 

Optimism has swung into positive territory and is 22% points higher than last quarter. All sizes of company are reporting increases. In the various sectors machine shops, mechanical equipment, metal manufacturing and fabricators are positive; machine shops and fabricators are reporting equal numbers of increases and decreases; and non-metal products and electronics are negative.

   

  Net  

  Up  

  Same  

  Down  

Output volume

2%

35%

33%

33%

Small companies

2%

30%

42%

28%

Medium companies

4%

43%

18%

39%

Large companies

0%

40%

20%

40%

Machine shops

-22%

22%

34%

44%

Mechanical equipment

23%

42%

39%

19%

Metal manufacturing

-12%

38%

14%

50%

Non-metal products

-33%

17%

33%

50%

Fabricators

16%

33%

50%

17%

Electronics

-80%

0%

20%

80%

 

Output volume is positive for small and medium companies and large companies are reporting equal numbers of increases and decreases. Across the sectors mechanical equipment and fabricators are positive; machine shops, metal manufacturing, non-metal products and electronics are negative.

 

  Net  

  Up  

  Same  

  Down  

Staffing

2%

26%

50%

24%

Small companies

2%

28%

46%

26%

Medium companies

0%

31%

58%

21%

Large companies

0%

20%

60%

20%

Machine shops

0%

22%

56%

22%

Mechanical equipment

8%

27%

54%

19%

Metal manufacturing

0%

38%

24%

38%

Non-metal products

-17%

0%

83%

17%

Fabricators

9%

17%

75%

8%

Electronics

-60%

0%

40%

60%


Employees

Employee numbers are positive for small and medium companies, and negative for large companies. Machine shops and metal manufacturing have increased; mechanical equipment, non-metal products and fabricators have reported decreases, and electronic companies have reported equal numbers of increases and decreases.

 

  Net  

  Up  

  Same  

  Down  

Overtime

-12%

19%

50%

31%

Overtime working has decreased for all sizes of companies.

   

  Net  

  Up  

  Same  

  Down  

Investment

8%

25%

58%

17%

Small companies

8%

21%

66%

13%

Medium companies

7%

30%

48%

22%

Large companies

20%

40%

40%

20%

Machine shops

44%

56%

33%

11%

Mechanical equipment

4%

19%

66%

15%

Metal manufacturing

0%

43%

14%

43%

Non-metal products

-16%

17%

50%

33%

Fabricators

17%

17%

83%

0%

Electronics

-20%

0%

80%

20%

Investment

Capital investment plans remain positive, although they have fallen slightly since last quarter. Within the sectors machine shops, mechanical equipment, and fabricators are positive; non-metal products and electronics are negative; and metal manufacturing are reporting equal numbers of increases and decreases.

 

  Net  

  Up  

  Same  

  Down  

Training investment

8%

36%

56%

8%

Training investment plans have improved slightly since last quarter, and all sizes of company are continuing to report positive figures.


Capacity Utilisation

Capacity utilisation has returned to positive after dipping into negative territory last quarter.

Mechanical equipment

Order intake total Mechanical equipment order intake has returned to positive levels after a dip last quarter.

Forecast

Forecasts for the next three months are more positive than previous quarters. In general, UK orders, export orders and output volume are forecast to pick up. Small and medium companies are forecasting positive figures for all measurements. Large companies are forecasting decreases in output volume and employee numbers.

Electronics, fabricators, machine shops and mechanical equipment are forecasting that the next quarter will be the same as or better than last quarter for all measurements. Metal manufacturing are forecasting a decrease in export orders and non-metal products are forecasting a decrease in employee numbers.

 

   Net       Up       Same       Down   

Orders

 42%

51%

40%

9%

UK Orders

 35%

 45%

 45%

10%

Export Orders

 27%

 36%

 55%

 9%

Output Volume

 30%

 40%

 50%

 10%

 


Balance of change %

Order
Intake UK
Orders
Export
Prices
UK
Prices
Export
Output
Volume
Employees
Small 27 22 20 10 28 9
Medium 52 38 15 24 39 18
Large 40 20 60 20 -20 -40
Metal Manufacturing 25 -15 25 14 38 0
Non-Metal Products 50 0 50 40 33 -17
Electronics 20 20 0 0 20 0
Fabricators 16 0 36 50 25 17
Machine Shops 56 20 11 20 44 22
Mechanical Equipment 45 54 25 4 23 12