Make UK 2025 Regional Outlook
Output for all English regions and devolved nations back above pre pandemic levels
For the first time since the onset of the COVID-19 pandemic, every English region and devolved nation has exceeded pre-pandemic manufacturing output levels, marking a major milestone for British industry. This remarkable achievement is highlighted in the newly released Regional Manufacturing Outlook 2025 report by Make UK and BDO, which provides a comprehensive overview of the sector’s performance, challenges, and opportunities.
Despite contending with prolonged cost pressures, geopolitical uncertainty, and persistent trade frictions, UK manufacturing has proven its enduring resilience and is now laying the groundwork for long-term growth.
The regional revival
The report paints a cautiously optimistic picture of the UK manufacturing sector. Output data through the end of 2023 reveals a long-awaited comeback: all English regions and devolved nations have now surpassed their 2019 manufacturing output levels.
Leading the resurgence are:
South West: Output soared by 27% above pre-pandemic levels, driven primarily by a booming aerospace and defence sector.
East of England: Up by 21%, buoyed by capital investment and renewed business confidence.
North West: Output climbed by 20%, thanks to major strides in aerospace, defence, and a rebound in the automotive industry.
Powering growth: aerospace, defence & advanced manufacturing
Sector-specific investments have been critical to this revival. The aerospace and defence sectors, in particular, have played a pivotal role, with surges in demand for aircraft and increased defence budgets across Europe fuelling growth in the South West and North West. In these regions, aerospace and defence account for over a quarter of total manufacturing output.
A tale of divergence: risks of uneven growth
While the national picture is one of progress, regional disparities remain a concern.
We are now likely to see a growing divergence between those regions and nations that have the sub sectors where greater levels of investment are taking place.
Regions with strong aerospace, defence, and advanced manufacturing clusters are charging ahead, while others with weaker sectoral presence risk falling behind. The report urges the government to ensure Local Growth Plans focus on evenly spreading opportunities especially as the new Industrial Strategy gains momentum.
Jobs on the rise – but not everywhere
One of the most encouraging findings from the report is the creation of 12,000 new manufacturing jobs in the year leading to March 2024, bringing the total sector employment close to 2.6 million.
However, this growth is not uniform. While the West Midlands and East of England saw gains of nearly 10,000 jobs each, Wales and the East Midlands suffered net losses of 12,000 manufacturing jobs. This disparity again highlights the need for targeted, region-specific policy support.
The trade outlook
On the international trade front, challenges persist:
Exports to the EU continue to decline, hampered by lingering trade barriers. Wales remains the most reliant on EU trade, with 61% of goods still heading to the bloc down from nearly 75% in 2020.
US tariffs loom large. The return of President Trump brought sweeping import tariffs, and regions heavily tied to US markets (such as the West Midlands, East of England, and London & the South East) may feel the impact more sharply.
Despite these pressures, a recent trade deal between the UK and US has brought some certainty back to transatlantic trade, though businesses remain cautious.
Looking ahead
As we move beyond the shadows of the pandemic and into a new industrial era, the report underscores a crucial point: now is the time to act.
The Government’s unveiling of a long-term Industrial Strategy which includes a strong focus on Advanced Manufacturing and energy support has been welcomed by the sector. But turning strategy into tangible results will require sustained investment in:
Skills and training
Innovation and R&D
Digital transformation
Sustainable practices
UK manufacturers, for their part, are ready. Investment intentions are rising, especially in the North West, and confidence is returning in areas like the East of England, where capital risk appetite has notably improved.
To summarise, the past five years have tested the UK manufacturing sector like never before. From grounded planes and idle factories to supply chain chaos and trade uncertainty, the road has been steep. But the industry has weathered the storm and come out stronger.
Now, the challenge is to keep the momentum going and ensure that no region is left behind.
Thank you for reading. For more information or a copy of the report visit our website here.