Talks between the United Kingdom and the European Union started in mid-July over the terms of Brexit, which has led to uncertainly mostly within the British manufacturing sector.
While politicians argue over the "divorce bill," two burning points of free trade and freedom of movement remain unsolved, adding to ambiguities over long-term investment and future of manufacturing in the U.K.
A year ago the referendum result took the business community by surprise, with most unprepared for Brexit and the foreign exchange impact, but today most global businesses are busy putting in place measures to insulate them from the most significant Brexit risks.
While trade barriers are of significant importance, one of the immediate problems facing the industry will be shortage of skills.
The plastics industry is the second-largest U.K. manufacturing sector with 166,000 employees. With nearly one-third of its output exported, the sector is one of the top 10 exporting segments in the U.K.
According to figures released by the British Plastics Federation, more than 11 percent of the entire workforce of the U.K. plastics industry are EU nationals, accounting for roughly 18,000 people.
"There is a skills shortage worldwide in all manufacturing sectors and this is something very apparent from our BPF Business Conditions Survey in the U.K. We certainly want non-U.K. EU staff to stay and we hope the U.K. Government and EU negotiators can provide the framework to give them security," BPF director general Philip Law told Plastics News Europe.
EU workers, he went on to say, constitute one in five of all factory floor workers and 48 percent of temporary workers in the plastics industry. For U.K. advanced manufacturing, there is a shortage of qualified scientists, engineers and technologists.
According to KPMG director and industrial manufacturing Brexit expert Justin Benson, the U.K. will need to ensure that it can still employ people from the EU to meet the "urgent skills" needed.
"The U.K. automotive sector currently has over 5,000 vacancies that must be filled if growth is to continue. Free movement of labor within European borders is also key, as any restriction undermines a global industry like automotive," Benson pointed out.
Joe Grimmond, chairman of U.K.-based Coral Products plc, went as far as describing the labor market in the country as "a significantly poorly educated labor pool," with companies facing shortage of highly skilled engineers and production managers and having difficulty training "at all levels."
But not all is lost amid the uncertainty.
Sales volumes and export volumes among U.K. chemicals manufacturers are continuing to rise, according to the latest survey of the Chemical Industries Association (CIA). Most producers are upbeat about prospects for the ,year ahead, with 50 percent of companies expecting exports to increase over the next 12 months compared to only 6 percent expecting a decrease. Meanwhile, one-third of companies saw the now expanding European economy as an opportunity over the next 12 months, the CIA added, noting that the EU is the sector's biggest export market with 60 percent of exports going to the bloc.
Brexit, however, continues to cast a shadow: CIA chief executive Steve Elliott noted that the survey also found "trading uncertainty was already weighing down exports and potential increases in regulatory costs was a big concern for chemical businesses."
On the business and trade side, BPF's Philip Law, made sure to clarify that while the U.K. has signaled an intent to quit the EU, the country has not yet "Brexited" and predicting outcomes without knowing terms of departure was impossible. He said that the latest BPF survey in February indicated a rebound in confidence from the low ebb recorded in June 2016, with almost 80 percent of the companies surveyed expecting sales to increase over the year to February 2018. This was reflected by wider manufacturing with car production hitting the highest level for some years.