The month of January is named after the Roman god, Janus.
Janus was the god of doors and gateways and famously had two faces. This meant he was able to look forward and backward at the same time.
That is what many of us do every January. We reflect on the year that has just gone by and cast our minds forward to think about the year yet to come.
This is probably truer this year than most. The way that COVID has continued throughout 2021 has prompted many people to take a step back to think about the shape of their lives and the direction that they want to take as they move forward.
It is the same for businesses too. The end of one year, and the start of another, is a good opportunity to reflect on the last 12 months and to look ahead to the challenges and opportunities of 2022.
2021 – A Year of Disruption
2021 was a year when flexibility and agility were absolutely critical to maintaining business continuity in the UK manufacturing sector.
COVID continued to shape the operating environment for all of us, with ongoing challenges around keeping workplaces open, ensuring staff and customers were kept safe, and maintaining production to keep the promises we made to our customers.
The virus also impacted in a range of other ways beyond public health. It affected supply chains and the availability of raw materials from overseas. This was made worse by the readjustment that we all had to make to post-Brexit trading conditions. Our response as a business has been to reassess how and where we purchase materials from. We have taken steps to shorten supply chains, to make sure that wherever possible we are working with trusted and reliable UK suppliers.
Impact on Sectors
The twin disruptions caused by COVID and Brexit have had a specific impact on some of the core sectors that ENL works with as a producer of high-quality plastic components.
Aviation and aerospace, in particular, have had a difficult period, with restrictions on travel affecting both orders for new planes and the need for routine maintenance. New plane orders fell 60% in 2020.
As we have written about previously, we are now seeing strong signs of recovery in that sector, with orders for new planes on the rise and a significant increase in air freight.
2021 also witnessed rapid growth in the logistics industry, fuelled by the pandemic-driven increase in online fulfilment. That industry also faced significant problems with labour shortages, particularly in the middle part of the year when a lack of HGV drivers led to shortages on the shelves of the nation’s supermarkets.
This also affected businesses like ENL, which had to take steps to respond to these challenges in logistics and supply chains in order to keep high-quality components flowing to our customers.
Rising Costs
The other unarguable trend of 2021 was the increase in costs, particularly of energy with wholesale prices for gas and electricity rising steeply. This has impacted on consumers and businesses alike.
Some of the reasons for these increases can be dismissed as relatively short-term, – for example, the particularly cold 2020 winter in Europe that led to lower levels of stored gas supplies. However, other trends will be more stubborn and longer-lasting, such as ongoing increased demand from Asia, and especially China, for natural gas.
It seems that high energy costs will continue to be an issue as we move into 2022. It is also important to remember that both domestic and business costs impact on our businesses. All of our employees are consumers too. As strains on their finances increase, that creates pressure on wages to keep pace with the cost of living, creating another challenge for manufacturing businesses such as ourselves.
“The Great Resignation”
The Great Resignation is the term coined by economists to describe the increasing numbers of people who are quitting their jobs, in part due to a reassessment of life and career paths prompted by the pandemic.
This is a worldwide phenomenon and one which has impacted particularly on the hospitality and manufacturing sectors.
At ENL Group, we are always looking at ways to attract, develop and retain the very best staff, but increased churn in the UK manufacturing sector jobs market means that, as we move into 2022, this will become more important than ever. Every time a staff member leaves, for whatever reason, we lose skills, knowledge, and experience. Replacing staff also carries a financial cost to the business. Ultimately, that means a cost to our customers too.
It is increasingly clear that businesses like ENL can never take workers for granted. Instead, we will need to invest in ensuring that there are rewarding careers that encourage staff to remain in the business and the UK manufacturing sector. Finding new ways to do this will be a central element in our plans for 2022.
Looking Forward
At ENL, we don’t have a crystal ball. Besides, if the last two years have taught us anything, it is that making predictions is fraught with difficulties.
However, several trends indicate that 2022 will be another challenging year for both businesses and the public. Indeed, the respected think tank, the Resolution Foundation, has already dubbed 2022 “the year of the squeeze”, where stalling wages, rising inflation, and increased energy bills will continue to impact businesses and consumers.
There are positives on the horizon too. We are confident that the wider economy’s return to growth will continue, as the vaccination programme helps the world open up for business.
The fact is the future is always unknown and uncertain. However, here at ENL, we are confident that we have the skills, strategy, and knowledge to navigate that future, whatever it looks like and whatever it brings. We are committed to supporting all of our customers to help them to do the same.
About ENL Group
ENL Group is based in Portsmouth, UK, and Veľké Kostoľany, Slovakia. Established in 1958, we have been servicing UK-based and European companies for decades. Working with a secure supply chain, ENL provides quality components for quality-driven customers – with full certification for all of our products and quality checking at every stage.
Operating 24/7, we design, manufacture and deliver critical components for our customers across the UK and Europe.
Contact Us for more information about ENL and how we can help your business.
