Key attention points from this quarter:
- Order intake amongst members improved by six percentage points to a balance of negative 4% from negative 10% last quarter with Export orders driving that change
- Output Volume remained net positive at 9%, down from a net balance of 11% last quarter
- For the coming three months, members forecast a net increase of 6% of businesses having increased orders, with output forecast for a net 15% increase in the same period
- Optimism holds positive – just – at a balance of 4%, represented by 28% up, 48% same and 24% down
The data in this Review were acquired by a survey of Scottish Engineering’s members and certain other manufacturing companies.
29% of members responded
Companies are described as:
Small (<100 employees), Medium (100–500) and Large (>500)
Annual trends
Order intake has for the second quarter, a net decrease of -4% representing, a slight improvement on last quarter’s-10%. Output volume has shown a very slight decline of 2 percentage points on last quarter but remains positive overall at 9% and exports have seen the most positivity this quarter with a +12% change (-11% to 1%). Staffing remains static since last quarter at 15% and capacity utilisation remains positive again this quarter at a net 2%, a slight decline from last quarter’s 6%.
Order intake
Output volume
Exports
Staffing
UK Orders
Net | Up | Same | Down |
-10% | 26% | 38% | 36% |
Overall, UK orders have improved slightly from last quarter from -12% to -10% albeit still a net negative. Small companies have been impacted most in this quarter at -14%, a decline for the second quarter running albeit with a very slight improvement from -17%. Medium companies are now seeing an impact too, with a decline from 0% to -4%. Larger companies are however recording an upward swing of 75 percentage points this quarter (-25% to +50%). Metal Products, Precision Engineering and Fabricators have seen a decline for the second quarter ranging from -27% to -67% and are now joined by Electrical and Electronics manufacture. Manufacturing has seen an improvement in orders, taking them from -26% last quarter to 0%. Plant & Machining remain positive at 10%, a small increase of 2% on last quarter.
Companies | Net | Up | Same | Down |
Small | -14% | 26% | 34% | 40% |
Medium | -4% | 25% | 46% | 29% |
Large | 50% | 50% | 50% | 0% |
Sectors |
|
|
|
|
Manufacturing | 0% | 35% | 30% | 35% |
Plant & Machinery | 10% | 30% | 50% | 20% |
Metal | -67% | 0% | 33% | 67% |
Precision | -30% | 20% | 30% | 50% |
Fabricators | -27% | 18% | 37% | 45% |
Electrical & Electronics | -25% | 0% | 75% | 25% |
Export Orders
Net | Up | Same | Down |
1% | 28% | 45% | 27% |
Export orders overall has seen a positive movement from -11% last quarter to +1% as an average of all sizes and sectors. Medium companies, for a consecutive quarter, report a decline, a further drop of 3% to -15%. Small companies have improved on last quarter from -10% to 4%, with this positive movement mostly due to larger companies moving +125% on last quarter. Plant & Machinery records a positive balance of change of 50%, an improvement from last quarter (0%) followed by Electrical & Electronics at 25%, an improvement on last quarter of-14%, however, Metal products and Precision Engineering both show a decline of -67% and -57%. Fabricators show equal positive and negative returns this quarter.
Companies | Net | Up | Same | Down |
Small | 4% | 33% | 38% | 29% |
Medium | -15% | 10% | 65% | 25% |
Large | 100% | 100% | 0% | 0% |
Sectors |
|
|
|
|
Manufacturing | 4% | 33% | 38% | 29% |
Plant & Machinery | 50% | 50% | 50% | 0% |
Metal | -67% | 0% | 33% | 67% |
Precision | -57% | 0% | 43% | 57% |
Fabricators | 0% | 0% | 100% | 0% |
Electrical & Electronics | 25% | 50% | 25% | 25% |
Optimism
Net | Up | Same | Down |
4% | 28% | 48% | 24% |
Optimism remains just positive overall with a net 4% for all companies and sectors. All sizes of companies this quarter have been positive: small (3%), medium (4%), large (50%). Most sectors remain positive in their outlook, with Electrical & Electronics, Plant & Machinery, Manufacturing and Precision Engineering (+40%, +30%, +11% and +10% respectively). Metal Products, for the third consecutive quarter, and Fabricators, for a second consecutive quarter, show a negative net outlook of -50% and -42% respectively. Plant & Machinery have increased optimism most in their outlook moving +22% from last quarter.
Companies | Net | Up | Same | Down |
Small | 3% | 31% | 41% | 28% |
Medium | 4% | 20% | 64% | 16% |
Large | 50% | 50% | 50% | 0% |
Sectors |
|
|
|
|
Manufacturing | 11% | 33% | 45% | 22% |
Plant & Machinery | 30% | 40% | 50% | 10% |
Metal | -50% | 0% | 50% | 50% |
Precision Engineering | 10% | 30% | 50% | 20% |
Fabricators | -42% | 8% | 42% | 50% |
Electrical & Electronics | 40% | 60% | 20% | 20% |
Output Volume
Net | Up | Same | Down |
10% | 37% | 36% | 27% |
Output volume remains positive this quarter at 10%, very slightly lower than last quarter (11%). All sizes of companies remain positive at +7%, +8% and +100% respectively. Plant and Machinery and Electrical & Electronics show the strongest net increase equally at +40% followed by Metal Products at +33%. Manufacturing too, remains positive at +11% whilst Precision Engineering and Fabricators show equal positive and negative returns this quarter.
Companies | Net | Up | Same | Down |
Small | 7% | 35% | 37% | 28% |
Medium | 8% | 36% | 36% | 28% |
Large | 100% | 100% | 0% | 0% |
Sectors |
|
|
|
|
Manufacturing | 11% | 41% | 29% | 30% |
Plant & Machinery | 40% | 50% | 40% | 10% |
Metal | 33% | 33% | 67% | 0% |
Precision | 0% | 40% | 20% | 40% |
Fabricators | 0% | 33% | 34% | 33% |
Electrical & Electronics | 40% | 60% | 20% | 20% |
Staffing
Net | Up | Same | Down |
15% | 30% | 55% | 15% |
Employee numbers are positive for all size of companies, small (+13%), medium (+20%) and large (+50%). Fabricators reflect the wider challenges particularly for the construction sector, albeit improved on last quarter with a staffing decline of -17%, an improvement of +12% on last quarter.
Companies | Net | Up | Same | Down |
Small | 13% | 28% | 57% | 15% |
Medium | 20% | 36% | 48% | 16% |
Large | 50% | 50% | 50% | 0% |
Sectors |
|
|
|
|
Manufacturing | 19% | 26% | 67% | 7% |
Plant & Machinery | 30% | 40% | 50% | 10% |
Metal | 0% | 0% | 100% | 0% |
Precision | 50% | 50% | 50% | 0% |
Fabricators | -17% | 8% | 67% | 25% |
Electrical & Electronics | 80% | 80% | 20% | 0% |
Overtime
Overtime working is broadly similar to last quarter with medium companies reporting the largest decline at -4%. Larger companies report the largest increase on overtime at 50% and matches the increased export orders.
Companies | Net | Up | Same | Down |
6% | 25% | 56% | 19% | |
Small | 9% | 28% | 53% | 19% |
Medium | -4% | 16% | 64% | 20% |
Large | 50% | 50% | 50% | 0% |
Investment
Net | Up | Same | Down |
14% | 32% | 51% | 17% |
Capital investment plans remain positive overall at +14%, a drop of 10% on last quarter with larger companies reporting the highest increase. Medium companies are reporting equal positive and negative returns on last quarter and Metal Products, Precision Engineering and Fabricators are reporting equal positive and negative returns on last quarter. Electrical & Electronics are, for the second consecutive quarter, showing highest levels of investment with plans at +50% (from +88%) followed by Plant and Machinery (+30%) and Manufacturing (+11%).
Companies | Net | Up | Same | Down |
Small | 17% | 33% | 50% | 17% |
Medium | 0% | 21% | 58% | 21% |
Large | 100% | 100% | 0% | 0% |
Sectors |
|
|
|
|
Manufacturing | 11% | 30% | 51% | 19% |
Plant & Machinery | 30% | 50% | 30% | 20% |
Metal | 0% | 0% | 100% | 0% |
Precision | 0% | 20% | 60% | 20% |
Fabricators | 0% | 17% | 66% | 17% |
Electrical & Electronics | 60% | 60% | 40% | 0% |
Training Investment
Reflecting the skills challenges across industry, all sizes of companies are reporting increased plans for training investment, with larger companies strongest with a net 100% of these companies reporting increased training plans. Small and medium sized companies also show positive net increases of +30% and +12% respectively.
Companies | Net | Up | Same | Down |
27% | 38% | 52% | 10% | |
Small | 30% | 39% | 52% | 9% |
Medium | 12% | 28% | 56% | 16% |
Large | 100% | 100% | 0% | 0% |
Capacity Utilisation
Capacity Utilisation remains positive with net +2% of companies reporting that they are at capacity, a decrease 4% compared to last quarter.
Order Intake Total
Manufacturing order intake has been impacted substantially this quarter with a significant increase from -35% to 0%, a decline last quarter that had not been recorded since quarter 2, 2021. This is also in line with increased output volume (+11%), increased employees (+19%), plans to invest (+11%) and with increased optimism on last quarter to +11%.
Forecast
Looking at the next 3 months, forecasts remain broadly positive for most company sizes and sectors. Larger companies are showing positivity in all areas. Medium sized companies are reporting a reduction in order export (-20%) with small and medium size companies reporting a decline in order intake of -8% and -2% respectively. Plant & Machinery have forecast positivity across all measures particularly in order exports, export prices, output volume and employees at +50% each. Electrical & Electronics outlook also remains positive: employees (+60%), UK prices (+50%), export prices (+50%) and output volume (-40%). Metal products this quarter are reporting a decline in three key areas: order intake (-67%), output volume (-67%) and export orders (-33%).
| Net | Up | Same | Down | |
Orders | 6% | 31% | 45% | 24% |
UK Orders | -3% | 24% | 49% | 27% |
Export Orders | -3% | 18% | 61% | 21% |
Output Volume | 15% | 33% | 49% | 18% |
Balance of change %
| Order Intake UK | Orders Export | Prices UK | Prices Export | Output Volume | Employees | |
|---|---|---|---|---|---|---|
| Small | -2 | 2 | 27 | 24 | 13 | 28 |
| Medium | -8 | -20 | 8 | 15 | 12 | 20 |
| Large | 50 | 50 | 100 | 100 | 100 | 50 |
| Metal Products | -67 | -33 | 0 | 0 | -67 | 0 |
| Precision Engineering | 10 | -14 | 10 | 14 | 30 | 30 |
| Electrical & Electronics | 0 | 25 | 50 | 50 | 40 | 60 |
| Fabricators | -9 | -25 | 8 | -25 | -27 | 25 |
| Manufacturing | -4 | 0 | 29 | 29 | 22 | 26 |
| Plant & Machinery | 20 | 50 | 30 | 50 | 50 | 50 |