THE Scottish engineering sector enjoyed an overall rebound in output volumes in the latest three months, even though the electronics category suffered a fall, but export orders continued to decline, an industry survey reveals.
Industry body Scottish Engineering's latest quarterly review of the sector, published today, also shows more firms enjoyed a rise in order intake than suffered a fall in new business in the latest three months. However, this was down to small companies. In the medium-sized and large company categories, more firms suffered a fall in orders than enjoyed a rise.
Subtracting the 24% of Scottish engineering firms suffering a fall in output volumes in the latest three months from the 37% reporting a rise, a net 13% enjoyed an increase. This was a significant improvement on a balance of 3% reporting a decline in the previous quarterly survey.
The small, medium and large company categories all shared in the rise in output volumes in the latest three months.
The decline in output volumes in the previous quarterly survey had followed a long run of growth.
The survey showed an overall expectation, in each size category, that output volumes would increase in the coming quarter.
A net 3% of Scottish engineering firms reported an increase in order intake in the latest three months, with 32% enjoying a rise, 29% encountering a fall and 39% experiencing an unchanged position.
In the small company sector, 37% of firms reported a rise in order intake and only 26% suffered a fall. Among large companies, 67% reported unchanged order intake and 33% suffered a fall.
In the medium-sized firm category, 28% reported a rise in order intake, 37% experienced an unchanged position and 35% suffered a fall.
Scottish Engineering highlighted positive trends in order intake in the machine shop, metal manufacturing and transport-related sub-sectors.
It noted overall expectations of an increase in order intake from within the UK in the coming quarter in the small and medium-sized company categories. In the large company category, the expectation was that UK order intake would be flat in the coming quarter.
In terms of export orders, 20% of Scottish engineering firms reported a rise in the latest three months and 31% suffered a fall. The net 11% reporting a fall in export orders was an identical outturn to that in the previous quarterly survey.
In all size categories, more firms reported a fall in export orders than enjoyed a rise.
Scottish Engineering cited the fabrication and transport-related sub-sectors as the only two which had signalled an increase in export orders in the latest three months.
However, looking ahead to the coming quarter, 29% of Scottish engineering firms predicted a rise in export orders, with only 19% anticipating a fall and 52% expecting an unchanged position. The survey showed overall expectations of a rise in export orders in each company size category.
Scottish engineering companies meanwhile reported an acceleration of the rate of increase in their staffing. A net 13% of companies reported a rise in staffing in the latest three months, with 27% increasing numbers and only 14% shedding employees. This was an improvement on the net 5% of Scottish engineering companies reporting an increase in staffing in the previous quarterly survey.
The small, medium and large company categories all reported an increase in staffing, with further rises anticipated in the coming quarter.
Bryan Buchan, chief executive of Scottish Engineering, has observed a "general mood of optimism" and "buoyancy of spirit" among companies, which he said tended to support the figures in the quarterly review.
However, he highlighted contrasting fortunes within Scottish engineering, with companies exposed to the oil and gas sector doing very well and those dependent on construction struggling.
He also highlighted skills shortages in the engineering sector.
Minister for Employment Relations and Consumer Affairs Jo Swinson, writing in the quarterly review, calls for Scotland to be at the forefront of promoting the participation of women in engineering. She says: "We must strive to improve on the lamentable statistic that in the UK only 9% of the professional engineering workforce are women."
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