According to the EEF, just a third of companies are looking to increase investment in plant and machinery and among small business, 75 percent are mothballing spending plans in the coming two years.
“These figures put into sharp focus the widening gap between the investment manufacturers know they need to make … and the hurdles they face in getting those decisions over the line,” said the EEF’s chief economist, Lee Hopley.
The survey found that 51 per cent of companies said their investment in plant and machinery had been put on hold because of Brexit negotiations, while more than a third had shelved plans for new or improved buildings.
Spending on research and development programmes and IT systems is also being cutback.
These cuts are coming despite mounting skills shortages and capacity constraints and, according to the EEF, companies are also cutting back on product development and training at a rate not seen since the last recession.
The EEF said its members had “sharply applied the brakes” to their investment plans and until some semblance of an agreement can be reached between the UK and the EU, it’s unlikely that is going to change.
