SMALL and medium sized manufacturers in Worcestershire are defying predictions of a slowdown in the sector by posting increases in current and predicted sales.

According to the latest Manufacturing Barometer for the West Midlands, 62 per cent have indicated that turnover increased in the previous six months with nearly three quarters expecting further increases over the next four months. In further positive news, 59 per cent of firms are still looking to recruit and 56 per cent said they were planning to increase investment in new technology, the highest figure recorded in the three-year history of the Barometer and an indication of a movement towards more advanced manufacturing. Responses to the Barometer survey showed the burden of regulation and finding new recruits with the right skills are the two main concerns for the region’s SME manufacturing base.

Lorraine Holmes, area director of the Business Growth Service’s Manufacturing Advisory Service, said: "There have been concerns that manufacturing is slowing down, and GDP figures from the Office for National Statistics did indeed reveal a slight decline. I’m pleased to say that SME manufacturers are feeling more optimistic. Turnover for the last period has bounced back and the outlook for future sales appears very positive, with automotive and construction strong and new opportunities in offshore wind and nuclear opening up previously untapped markets.

“Record investment plans in technology should be welcomed. This shows companies are recognising that they need to spend in order to compete globally, offering unique processes and technologies that establish themselves on the added value chain.

“Predicted recruitment of new staff has also remained high, although this could be due to companies not being able to find the skilled employees they need. Any slowdown by the bigger manufacturers will take a while to cascade down the supply chain. We have to be mindful that there might be a delayed reaction to the predicted slowdown.”

Business minister Matthew Hancock added: "Small businesses have been at the forefront of our economic recovery and today’s findings show no sign this is slowing down. We are committed to making Britain the best place in the world to start and grow a business, which means backing manufacturers every step of the way."

The Barometer is the largest survey of its kind, reflecting the views of 79 SME manufacturers across the West Midlands, employing more than 3500 people.