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Tag: Manufacturing

UK on track to becoming a tech superpower

New data reveals the IT and information services industry has seen the biggest improvement in productivity – growing by 13.71% year-on-year (YOY) since Q4 2022.

The Business Productivity Index, by ECI Software Solutions, reveals the 20 industries have seen the biggest leap in productivity and the least.  Between January to March 2023, the total register for public companies increased by 63,462 – 8.2% more than the same period in the previous year.

ECI’s Business Productivity Index analysed Office for National Statistics (ONS) data to see which industry’s productivity has grown the most, YOY. To create the business productivity index, the ECI used ONS productivity overview data from 20 industries relating to the final quarter of 2022, which was segmented by industry and year, to understand percentage change over time.

The IT and information productivity growth of 13.71%  – validates the UK’s drive toward becoming a technology and science superpower – with more than three million people working in UK tech. Since the ONS started measuring labour productivity, its average lifetime output sits at 74.79, while in 2022 it reached 121.1.

Productivity growth for businesses manufacturing food products, beverages and tobacco rose the least YOY, by just 2.02%. This was the only manufacturing sub-sector featured on the list to experience an increase in productivity. Production of transport equipment products took the biggest productivity hit, falling by 7.98% when compared to the same period last year.

Four other sectors of manufacturing also suffered a productivity loss – the manufacture of wood and paper products, printing and reproduction of recorded media fell by 2.77%; the manufacture of chemicals, chemical products and basic pharmaceutical products fell by 4.21%; and the manufacture of computer, electronic and optical products and electrical equipment fell by 4.64%. Although the manufacture of basic metals and fabricated metal products fell by 7.98%, this industry’s lifetime average is the highest on the list, at 100.48 points. In comparison, the average lifetime output for real estate activities (excluding imputed rental) sits at just 70.75 overall and is the lowest.

Beyond manufacturing, the industry with the biggest YOY productivity decrease was real estate activities, which decreased by 3.60%, and production which fell by 2.50%. The ONS has created a calculator for businesses to understand how productive they currently are.

Chris Fisher, VP of EMEA, LBMH at ECI Software Solutions said: “There’s a real push to improve productivity across the UK, getting us up to speed with some of our global peers. Recent statistics show that, across all industries, productivity is still at the same level as it was before the pandemic – though it has managed to successfully rise above the 2020 dip. Manufacturing seems to be particularly harshly hit and likely to be reeling from the effects of Covid-19 yet it also poses the most exciting opportunity. Data and IT services are becoming more accessible – and in turn, manufacturing businesses are well placed to make the most of the innovations coming out of the sector to help it work smart in the future.”

ECI’s Business Productivity Index can be viewed online here.

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However, the sector is at its lowest rate since June 2020

According to the Institute for supply Management report the “Manufacturing ISM Report on Business” the US manufacturing sector grew in August at the same rate as in July — which was the lowest rate in more than two years. While employment in manufacturing picked up, concerns about a slowing economy have remained.

The Manufacturing PMI report is based on a survey of manufacturing supply executives.

Overall, the ISM’s Manufacturing PMI’s reading of 52.8% in both August and July was the lowest level since its 52.4% reading in June 2020. Readings above 50% indicate expansion in the US manufacturing sector.

August’s reading also indicates expansion in the overall economy for the 27th month in a row after contracting in April and May 2020, said Timothy Fiore, chair of the ISM’s Manufacturing Business Survey Committee.

Respondents noted price expansion eased dramatically; however, they continued to express unease about a softening economy.

Employment was a bright spot.

The measure of employment in the report returned to expansion in August after three months of contractions. It was at a reading of 54.2% in August, up from 49.9% in July. Readings above 50.5% over time is generally consistent with an increase in US Bureau of Labor Statistics data on manufacturing employment.

Timothy Fiore, Chair of the ISM’s Manufacturing Business Survey Committee commented: “According to Business Survey Committee respondents’ comments, companies continued to hire at strong rates in August, with few indications of layoffs, hiring freezes or head-count reductions through attrition. Panelists reported lower rates of quits, a positive trend.”

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Flexible working encouraged as a solution to staffing issues

Constant staff shortages across all industries in recent months have resulted in chaos across all sectors from logistics to hospitality, including disruption within food production and airports such as Manchester.

Staffing agency GIG is countering this by encouraging businesses to embrace new ways of working and offering people the chance to find jobs that fit their lifestyles. They’re increasing their reach in the North West by reopening and expanding their Manchester office.

The British Chamber of Commerce advised that 76% of businesses faced recruitment difficulties in the second quarter of 2022. The manufacturing, logistics, and hospitality industries experienced some of the biggest struggles.

GIG is a staffing agency focused on maximum flexibility for its workers and clients. They see a model where workers can pick when and where they work, how many shifts they need and how often, and training to take on new roles.

Tony Carnall will lead the new office. Carnall has a long background in hospitality and is familiar with the challenges of keeping the sector and others like it well staffed.

Antony Woodcock, MD at GIG, said: “The recruitment crisis we’ve seen in the past year isn’t going away on its own, we’ve got to rethink what we offer potential workforces.

“Central to our ethos is understanding that everyone is different and the types of work they will want to do varies – there’s no one size fits all.

“Parents might want shifts that fit around childcare, more young people are looking for travel and new experiences and need a job to match – these opportunities aren’t always readily available and so we’re excluding valuable workers from the labour force.”

“But that flexibility can be a tricky path for many businesses to take, as they fear uncertainty – we wanted to create a system that gives businesses the opportunity to use flexibility in new ways”

Tony Carnall, Regional Manager, GIG’s Manchester office, commented: “I’m excited to be back working with the Team at GIG and getting our Manchester Office set up and running. Manchester has grown so much over the last few years that now feels the right time to bring what we offer at GIG to the city.

“My aim is to grow a strong, reliable workforce through regular recruitment and interview days, and building strong relationships with both our clients and candidates past and new.

“Having worked with sectors such as Hospitality, Warehousing and Events, I know how challenging staffing can be – but building strong relationships with our clients and workforces will help combat those issues.”


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Half of employees report higher productivity with new arrangement

The Manufacturing Technology Centre (MTC) has just announced a decision to implement a four-day work week for its 820 employees with no reduction in salary.

Following a large-scale, two-year trial the company took the decision in response to positive employee feedback. According to a staff survey:

  • 83% of employees reported that they were happier
  • 50% of employees felt that they were more productive
  • 42% reported increased energy levels
  • 40% experienced better mental health

According to MTC’s calculations, the new flexible working arrangement will save 664 tonnes of carbon each year, helping the company meet its sustainability goals.

The trial began in April 2020 and gave 615 employees across the organisation a variety of  flexible working arrangements – one of which was a four-day week.

Alongside the employee feedback, Loughborough University conducted a separate external evaluation and found that employees felt “overwhelmingly positive” about the arrangement and that it was also a very attractive feature for new recruits.

MTC will now work with various industrial partners, including Rolls-Royce, Siemens, and Meggitt, to share their data and lessons learnt from the trial.

Vicki Sanderson, HR Director at the Manufacturing Technology Centre, said: “We’ve been operating flexible working patterns since April 2018, but employee engagement surveys have shown that staff wanted to extend this further.”

“We explored a range of options, including researching what was important for Millennials and Generation Z, as 79% of our workforce fall into these categories. Work-life balance was the priority, and our survey results reflected this.”

“The positive impact on staff was evident. After 12 months of the trial, 96% wanted the Fully Flexible Working Week to be adopted permanently, and these changes have had a direct impact on improving the mental and physical wellbeing of our employees, while improving business productivity.”

“We know that in manufacturing especially, it’s very difficult for some roles to be offered flexibly, for example, the opportunity for more home working. But other ways to do this should be considered, and our study has proved this is possible,” said Sanderson.

Dr Clive Hickman OBE, Chief Executive of the Manufacturing Technology Centre, said: “Flexible working has been the norm at the MTC long before the pandemic, but employees told us there was more we could do. The result is our Fully Flexible Working Week, including a four-day week, which I’m proud to be making permanent. The MTC is striving to become the most attractive employer in the country, and this is a big step towards achieving that.”

Dr Ella-Mae Hubbard, Lecturer at Loughborough University and author of the external evaluation, said: “It is clear from our study that there are strong feelings about the trial. For the MTC employees, the reaction has been overwhelmingly positive and for newer members of staff, these new policies were one of the main reasons that they joined the MTC.”

Andrew Peters, Managing Director at Siemens Digital Industries Congleton, said: “Siemens AG quickly committed to a permanent hybrid way of working and while this has provided many of our employees more flexibility, the management of this change has been of critical importance.”

“Central to managing this has been lots of active listening, open communication, and empathetic leadership. We have taken an agile approach in making small changes, seeking lots of feedback from our employees before committing to bigger decisions. Alongside this, we are also dedicating more of our time to adapting and developing our culture.”

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Impact of the Ukraine crisis is not reflected in employer hiring 

According to the ManpowerGroup Employment Outlook Survey, strong hiring optimism has continued into the second quarter of 2022. The survey of 41,000 employers showed that employers in 36 of 40 countries reported stronger hiring intentions than this time last year with the greatest demand in IT, finance, and manufacturing. The demand for skilled workers has remained at a record high as employers continue to look to attract and retain the best, diverse talent while embracing the post-pandemic era. 

The ManpowerGroup Employment Outlook Survey is the most comprehensive, forward-looking employment survey of its kind, used globally as a key economic indicator. The Net Employment Outlook is derived by taking the percentage of employers anticipating an increase in hiring activity and subtracting from this the percentage of employers expecting a decrease in hiring activity. 

Jonas Prising, CEO and Chairman of ManpowerGroup commented: “Labour markets around the world are looking strong for Q2, with hiring outlooks back at pre-pandemic levels in most countries. Any impact of the Ukraine crisis is not reflected in employer hiring intentions. While Poland and neighbouring countries are dealing with the humanitarian crisis, we must be poised to help resettlement and employment efforts for refugees, adapting roles and requirements to fill vacancies and create new opportunities.” 

Jonas continued: “At ManpowerGroup we are working fast to leverage our experience integrating refugees into labour markets from other countries – for example from Syria to Germany, Afghanistan to U.S. – and to adapt and scale reskilling and upskilling programmes specifically targeted to this population. Now is the time for collaboration between employers and governments to make it as fast and simple as possible to integrate refugees into the workforce so they can earn a living, contribute to society, and most importantly feel welcomed in their new surroundings.” 

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