One of Britain’s biggest manufacturing industries has reported continued growth in its economic performance.

The latest business survey of members of the Chemical Industries Association shows a fourth successive quarter of strong results. 94% of businesses reported that total sales had stayed the same or actually increased in the second quarter of the year, compared to Q1. The industry, often referred to as the leading exporter, saw a jump in global exports, with 47% of companies increasing their level of exports, 91% seeing continuous or increased levels to the EU, whilst all companies said their rest of the world exports were continuing at the same level or even increasing. Chemical manufacturers also saw strong growth in new orders, with 47% reporting an increase, and all other companies seeing no fall in new orders.  

Looking ahead to the next quarter, companies remain optimistic with 94% saying exports would remain at current levels or would increase. On jobs, R&D spend and overall business investment, the outlook remains positive with 94%, 97% and 88% of companies reporting levels across all three measures continuing at current levels or increasing.

Steve, Elliott, Chief Executive of the Chemical Industries Association said: “These numbers represent continued hard work by chemical businesses and their workforce. It is solid evidence and reward for continuously and safely working through the pandemic. Our focus now turns increasingly to the opportunities and challenges of net zero with our latest survey showing the industry well-placed to continue manufacturing innovative products that will help the country deliver a new future.  

Despite this, there are challenges for the sector. Over the last three months, 88% of companies experienced a sharp rise in the cost of raw materials. Most of this increase is being borne out by manufacturers but the worry would be how sustainable it is for businesses to do that over a period of time. Similarly, it is taking longer to get products to customers with 44% of companies reporting delays due to freight container shortage, border delays, driver shortage and other reasons.”

Elliott warned that the challenges could undo much of the progress made by the industry and that “A continuation of these problems will have a major impact on businesses?”. He ended “I hope we can quickly resolve the numerous factors driving raw material challenges and minimise Brexit-related border movement problems to enable an even stronger business performance”.

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For more information please contact Simon Marsh at [email protected] or 07951 389197.

• Businesses who make chemical products and solutions are integral to something like 96% of all manufactured goods.  Whether it is ingredients for food and medicines; paints and coatings for cars and planes or materials for mobile phones and electric vehicle batteries, the chemical industry is truly the “industry of industries” – also playing a critical role in the nation’s response to Covid-19 through its supply of hand sanitiser, PPE and vaccine ingredients.

• Chemical businesses are located throughout the UK, with many of them clustered together in the North East of England, North West of England and Central Scotland.  These factories and laboratories, operated by a highly trained and skilled workforce, make a significant contribution towards the UK’s productivity performance – double that of any other manufacturing industry and triple that of any part of the UK economy.

• Nearly half a million people are employed in the sector or have roles that are dependent on the sector. Chemical workers typically earn 35% more than other manufacturing industries and 54% more than the average worker.

• From Runcorn to the Humber Bank; from Teesside to Grangemouth, chemical businesses and their employees right across the country are essential to the Government’s levelling-up agenda.

• We are the country’s biggest manufacturing exporter, sending goods to the value of more than £57 billion to other countries. The EU represents our most important market, but we continue to work closely with Government to inform and secure UK trade deals with other key chemical markets such as Japan and the USA.