While December is rolling into its second half, businesses are preparing their forecasts for 2019. And with such an unstable political situation it is difficult to predict anything. What’s more, for businesses based on manufacturing revenue model this political uncertainty continues to knock confidence.

This is furthered, by the fact that manufacturing production in the UK has fallen over 1 percent YOY in October 2018 according to statistics. It was the first decline in factory activity since October 2016. While the weak pound has led to a rise in export figures, there are several key challenges facing manufacturing in 2019.

  1. Brexit

One of the key challenges facing manufacturing in 2019 is Brexit. A report has warned that British manufacturers are already sharply pulling back on their investment plans due to the mounting uncertainty over Brexit and a growing fear of a global trade war. Also, only a third of businesses are planning to increase their investment in plant and machinery – a record low according to the survey by EEF manufacturers’ body and Santander Bank.

Additionally, the weak pound has had a mixed impact across the UK’s manufacturing industry. Raw materials have become more expensive to import, while exports have become cheaper and grew demand in some areas.

Brexit is going to be one of the most significant challenges facing manufacturing industry in 2019 and will have to be the top priority to be considered in planning. Brexit will clearly have a strong impact on businesses, and if you think you can avoid it, think again!

  1. Workforce shortages

Changes in the working culture, candidate expectations and an ageing workforce have left many industries with workforce shortages across the UK. A recent study has found lasting effects of the recession, reduced graduate intakes have led to shortages of the workforce, as well as many of those who were already established in manufacturing leaving the industry. Gaps in education and shortcomings in training remain an issue, therefore workforce shortages will be one of the challenges facing manufacturing.

Most industries have reported a struggle to find top-tier professionals and numerous businesses are re-considering their talent recruitment strategies. For most industries, including manufacturing, the skills most in demand in 2018 are a continuation of the last few years, and it appears that 2019 will be the same.

Many believe that to help promote careers, companies should partner more effectively with local universities to educate students on potential career paths and offer more work placements or apprenticeships. And this will be particularly important in 2019 for those businesses that offer more manual roles, as the net migration of EU workers has been subsiding post-Brexit vote. Many industries are already reporting workforce shortages.

  1. Digital innovation and growth

The UK manufacturing industry has been struggling behind many other countries when it comes to digitalisation of the sector. So, the UK manufacturers must think harder than the most to find new ways of increasing revenue. Digitisation provides the opportunity that British manufacturing industry needs, improving processes, saving time and creating better relationships with new and existent customers would bring in new revenues and expand the opportunities. Additionally, the digital culture introduces a whole new concept to an outlook on competition and some report that a third of top 20 companies in key industries will be disrupted by new competitors in the next few years.

Digitisation is particularly becoming a problem, as while there have been improvements in 2018, it has been but nowhere near enough or fast enough – reflected in the widening gap between the UK and the rest of the world, particularly the G7 nations. Due to this, the UK has already lost jobs and entire industries to those, who can accept and adapt digitisation faster.

This will require the manufacturing industry to switch to a more employee centred approach that will be based around training and upskilling to deliver sustained progress within the organisation and the industry overall, which will be further challenged by the staff shortages.


The manufacturing industry is going to face some serious challenges in 2019, and while many of the problems illustrated don’t have quick solutions, they can certainly be mitigated with smart planning and strategic operations. ProForecast is the leading strategic business planning & financial forecasting tool for businesses, who are looking to increase their KPI, cash flow and other financial business performance. Our manufacturing model can accommodate all your manufacturing needs, and allow you to strategically plan for both expected, and unexpected scenarios.