UK engineers optimistic about 2023 reveals latest survey from The Engineer

The findings of The Engineer’s latest business confidence survey reveal an industry that despite global challenges and uncertainties is relatively optimistic about the future.

This November, in order to find out how industry’s engineers are feeling about the challenges they face, The Engineer conducted its latest end-of-year business confidence survey. 

We asked our readers  - drawn from across industry - to tell us how they are feeling about the year ahead, what technology areas and sectors they expect to dominate, and how they expect their own organisations to perform.

What’s more, by comparing this year’s results with those of our previous survey (published in December 2020) we are able gauge whether confidence levels have improved or declined over the past two years. The key findings are highlighted here. 

Conducted during November 2022, and sponsored by enterprise software specialist Planview, the survey was completed by 146 respondents from a range of different sectors. The largest single response group (29 per cent of respondents) was from manufacturing, with the next largest sample groups from the electronics, defence & security and aerospace sectors, which each accounted for six per cent of the response group.

Key findings

  • 57 per cent of respondents are confident about the year ahead
  • 12 per cent are concerned about the year ahead
  • Energy efficiency and the push for net zero identified as the key technology areas for 2023
  • 26 per cent anticipate increased investments in new Product development
  • More than half of respondents expect R&D and NPD investment to flatline
  • Supply chain disruption viewed as key challenge of 2023

Confidence snapshot

In a gratifying - and perhaps surprising - indication that UK engineering firms are in a relatively positive frame of mind, well over half of respondents (57 per cent) say they are confident about the prospects for their businesses over the next 12 months. This marks an increase on our 2020 figure of 50 per cent, suggesting that despite lingering uncertainty, industry’s optimism hasn’t been completely derailed by recent global events.  Either that, or industry has simply become more used to operating in an ever-more volatile and unpredictable global market.

Echoing our previous survey’s findings, 31 per cent of respondents tell us that they are uncertain about what the year ahead holds, however the proportion of respondents who report feeling actively concerned and worried about the future appears to have dropped marginally, from 16 per cent in 2020 to 12 per cent in 2022.

Asked to identify the drivers for views on the year ahead, respondents offer a range of views.  Those at the positive end of the spectrum cite strong order books, a continued demand for product and expertise as reasons to be cheerful. Whilst those viewing the months ahead with more trepidation point to  supply chain issues, price volatility and high energy costs as major causes of concern. A number of respondents also cite Brexit as a major source of economic uncertainty .

Asked to point to the sectors that they expect to perform most strongly in the year ahead, respondents identify Defence (20 per cent) and Renewables (14 per cent) as the sectors to watch in 2023. This is perhaps not particularly surprising given the continuing hostilities in Ukraine and the increasing momentum behind the push for net zero greenhouse gas emission.  

Industry trends

Asked to rank a number of key industry trends in order of importance over the coming months, respondents identify energy efficiency and the push for net zero as the dominant trend that will shape their business.  As The Engineer’s regular coverage – and indeed many of the articles in this supplement attest - decarbonization is now the major driver of innovation across most engineering sectors, and its not surprising to see it moving into the priority slot for respondents.

Net zero is followed closely by another pair of topics that loom large in this special issue -  Digitalisation and automation – which occupy second and third place in this year’s report. Of the remaining options offered to respondents, reshoring (the process of relocating manufacturing operations to the UK)  and servitisation (which describes a shift towards more service oriented business models) and were placed in fourth and fifth place respectively.

Investment & Challenges

As the UK economy attempts to drag itself out of recession, investment in the future will be key, and we asked respondents whether, within their own organisations, they expect to see an increase of investment in research and development (R&D) and new product development (NPD).

In both areas our findings paint a mixed picture with just over 50 per cent of respondents expecting investment in both to flatline over the next 12 months.  A quarter of respondents anticipate an increase in investment, whilst the remainder expect to see cuts to spending in these areas.

Meanwhile, asked to rank the key business challenges they expect to face during 2023,  respondents identify supply chain disruption as the key area of concern. This is followed by growing worries over access to a skilled workforce, concerns over energy costs and - finally - reduced access to key markets.