Factory recovery ‘painfully slow’ says trade group – Daily Business

Scotland’s engineering companies are witnessing a “painfully slow recovery”, according to the sector’s trade body.

While exports in Q3 remained negative for the fifth consecutive quarter (net -14%), order intake and output volumes show signs of stabilising.

Staffing levels have begun to shift in a positive direction for the first time this year (+1%) in a further sign of improvement.

Scottish Engineering said a big driver for the positive shift has come from larger firms, whose UK orders rose. However, the picture for smaller organisations remains a cause for some concern as they continue to report negative figures.

Paul Sheerin, chief executive of the trade group, said: “The impact of the employment taxation route our UK Government chose to take results in this painfully slow recovery.

“Whilst there are signs of improvement, further impacts such as the potential for increased energy costs ahead of the winter concern us that we could stall the slow progress that has been made.

“Recovery will come – sooner or later – and so it’s important that we look out for the longer-term strategies that will ensure we make the most of an improving economy when it returns.”

Mr Sheerin said companies continue to question the cost and time commitment required to train apprentices.  Sixty percent of companies identified the financial burden of funding the four-plus years of investment – at an average of over £100,000 per apprentice – as the critical issue.

He said that the relevant post school skills reform bill proposed by the Minister for Skills and currently working its way through the Scottish Parliament “contains nothing that will address these fundamental problems”

He added: “For a process that has been running for two years and will likely run – assuming it gets passed – for the same time and more, that’s a long time to leave these unattended.

“In light of this, we are grateful for the Deputy First Minster’s attention to the potential impacts on Scotland’s economy – positive and negative – for this issue and so welcome her genuine engagement – whilst we have her – with our sector for potential solutions for this challenge.”