The latest Make UK Manufacturing Outlook Q3 2025 report paints a cautiously optimistic picture for the UK’s industrial economy.
After a turbulent few years of inflation, supply chain disruption and labour shortages, manufacturers are reporting their strongest performance since 2021 — with rising output, growing export demand and renewed investment confidence.
But while the headlines are positive, the underlying message is clear: sustainable growth will depend on productivity. In this article, we look at the findings from Make UK's Q3 report and explore practical ways technology can help to offset the challenges, enabling manufacturers to focus on what they do best, more efficiently and profitably, helping them turn recovery into long-term resilience.
Overall business confidence: 7.0/10 (very strong).
Most confident regions: East of England (7.9), South East & London (7.5), South West (7.1).
Least confident: Scotland (4.9) and North East (6.3) — though still positive.
Confidence linked to clarity from the Industrial Strategy and investment incentives.
Output up to +25% — strongest since 2021. Growth driven mainly by larger firms (£10m+ turnover).
UK orders up to +12%; export orders up to +23% (especially EU and Asia).
Manufacturers expect continued growth next quarter (+26% output expectation).
Some of the increase may reflect stockpiling and short-term trade reactions to US tariff tensions.
According to Make UK’s survey, output across UK manufacturing rose to +25%, up from just +9% last quarter — the best result since the post-pandemic rebound of 2021. Both domestic orders (+12%) and exports (+23%) saw strong growth, particularly to the EU and Asia, while investment intentions jumped to +24%, the highest level in four years.
Employment has also started to recover, with manufacturers reporting a +15% employment balance, suggesting that firms are beginning to recruit again as confidence improves.
However, this recovery is uneven. The report highlights that much of the recent uptick has come from larger firms, while many SMEs are still operating cautiously as cost pressures and uncertainty remain.
Domestic prices eased to +15% (first major slowdown since 2021).
Export prices surged to +29%, with export margins turning positive (+6%) for the first time since 2021.
The gap between domestic and export price-setting (14 points) is the largest in a decade.
Inflation, while easing from its 2022 highs, continues to weigh on manufacturers. As of July 2025, CPI stood at 2.8%, above the Bank of England’s 2% target, and 68% of firms reported higher business costs than expected in the past six months.
Although fewer manufacturers raised prices this year compared with 2022 (59% vs 78%), margins remain fragile — particularly for domestically focused manufacturers.
In response, 70% of firms now plan to invest in automation or digital technologies to manage costs and improve efficiency — signalling a major shift in mindset.
“The industry has learned lessons in operational resilience,” notes the report. “More businesses are adjusting output dynamically and investing in automation to tackle costs.”
71% of manufacturers now plan to invest in automation and digitalisation — a record high.
Digitalisation is no longer optional; it’s critical for cost control and competitiveness.
AI is helping manufacturers improve predictive maintenance, quality, and demand forecasting — but only works with clean, connected data.
BDO’s commentary within the report is clear: digitalisation is now a strategic necessity for UK manufacturers.
Rising energy costs, global trade volatility and workforce challenges are forcing businesses to rethink how they operate — and how they can use technology to become more agile. Artificial intelligence, data analytics and machine connectivity are already being used across factories to improve productivity, predict maintenance needs, reduce energy waste and optimise production schedules.
But BDO’s analysis warns that these initiatives rely on a foundation of clean, connected data.
“AI enables smarter decision-making by surfacing insights that would be impossible to analyse manually,” says BDO Digital Partner Catherine Wilks.
“But manufacturers must ensure their data is clean, accessible and secure, with integrated solutions that empower their workforce.”
This is exactly where FourJaw supports manufacturers on their digital journey. As a plug-and-play production monitoring platform, FourJaw provides factories real-time visibility of accurate and clean machine utilisation, downtime causes and energy use — across every make, model and age of machine.
By making production data simple, accessible and actionable, FourJaw helps teams identify where capacity is lost and where improvements can deliver the biggest impact.
Our customers use FourJaw to:
Increase machine utilisation by identifying and reducing downtime.
Track energy usage to cut costs and improve sustainability.
Empower operators to log issues easily on the shop floor.
Support continuous improvement through consistent, comparable performance data.
Manufacturers like AMS, Listers and SPS Technologies have used FourJaw to achieve productivity improvements of up to 23%, unlocking hundreds (273 to be exact) of additional production hours each week — without new machinery or extra shifts.
In an environment where costs remain high and competition is global, these gains directly impact the bottom line.
Lister Windows saw an average machine utilisation uplift of 10%, which resulted in them being able to manufacture an additional 250 windows per week, thanks to the extra capacity they gained from the uplift.
Make UK’s report concludes that confidence remains high across most UK regions, with businesses encouraged by the new Industrial Strategy’s focus on manufacturing, energy cost reduction and skills development. Yet the message is consistent: short-term recovery must evolve into long-term reinvention.
Manufacturers are ready to modernise — and they’re looking for technology partners who can make that transformation achievable.
The Make UK Manufacturing Outlook Q3 2025 report shows real momentum in UK manufacturing:
Output and orders are rising.
Investment confidence is returning.
Digitalisation and automation are taking centre stage.
But to sustain growth, manufacturers need more than optimism — they need data they can trust to make informed decisions across their operations.
Whether it’s building a connected factory, tracking improvement initiatives, understanding capacity constraints or improving margins, FourJaw provides the visibility manufacturers need to improve productivity, protect margins and grow sustainably.
The question to ask yourself is, are you one of the 71% that are ready and willing to invest in automation and digitisation, or will you be one of the 29% that runs the risk of getting left behind?
Read the complete report at Make UK.