Technologies such as the internet of things (IoT), machine learning and big data will boost UK manufacturers, according to 43% of companies in the sector â but there is a reluctance to invest.
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The research, involving 500 companies and conducted by Barclays Corporate Banking, comes as UK manufacturers warn of the risks of the government leaving the country without a trade deal.
With manufacturers uncertain of the future relationship between the UK and its biggest trading partner, the EU, investment in new technology might not seem a priority, but the research suggested that if manufacturers donât invest, they might miss out on revenues of £102bn a year.
The research, which did not mention Brexit, found that 83% of manufacturers are confident about the UKâs ability to compete in the international marketplace over the next five years.
More than half (51%) of manufacturers reported that adopting the latest technologies has improved productivity, and 27% are already seeing return on investment.
But many manufacturers are still reluctant to invest in smart technology in their factories, despite more than half of them reporting that technologies such as artificial intelligence (AI), IoT and big data have improved productivity. The survey found that this reluctance could cost manufacturers £102bn a year in lost revenue.
The survey revealed that 35% of manufacturers would be more likely to invest if they understood the tangible benefits of smart tech better, with 23% not clear what the return on investment would be.
But the government does not seem to be helping matters with a lack of communication â 36% of manufacturers said they had not heard of the governmentâs industrial strategy.
Skills are also a concern, with 21% of respondents citing a lack of skilled workers as their reason for putting off investment in technology.
The research did not mention uncertainties caused by Brexit as a reason for manufacturers holding back investments.
Mike Rigby, head of manufacturing at Barclays, said the industry is at a watershed. âBritish manufacturing is going through another industrial revolution, but confidence alone does not translate into success and benefit,â he said. âWith sterling currently weaker and a robust appetite from domestic and international markets for British goods, the industry is in a strong position to take advantage of the opportunities that investing in fourth industrial revolution technologies can bring.â
According to a survey by Forbes Insights, manufacturers face challenges in acquiring the right IT skills and improving collaboration between their IT teams and the business. It found that 40% of senior IT decision-makers in North America and western Europe say a skills shortage is the biggest challenge in taking their digital strategies forward, while about one-third see a lack of collaboration between their IT department and business teams as a problem.