UK Engineering Sector Prioritizes Energy Efficiency Amid Skills Crisis

According to Engineer Live, new research from IMI’s Industrial Automation division reveals strong industry support for the UK government’s ten-year industrial strategy focusing on energy efficiency and sustainability. The poll of engineering and manufacturing companies found that 38% of businesses cited energy efficiency as the most significant opportunity for improving their pneumatic or motion systems, while 29% selected system reliability and 24% maintenance predictability. When asked about growth opportunities in the energy sector, 22% identified advancing sustainability as key, while skills shortages emerged as the strongest concern at 44%. Daniel Coetzee, vice president of Growth for IMI’s Industrial Automation, noted the growing demand for energy-efficient solutions and expertise in addressing industrial sector challenges. These findings highlight how industry priorities are aligning with government strategy.

The Energy Efficiency Imperative

The strong focus on energy efficiency reflects both economic and regulatory pressures facing UK manufacturers. With industrial energy costs remaining significantly higher than pre-crisis levels, companies are recognizing that efficiency improvements directly impact their bottom line. Beyond immediate cost savings, the emphasis on energy performance represents a strategic shift toward operational resilience. Companies that master energy optimization will be better positioned to weather future price volatility and comply with increasingly stringent environmental regulations. The 38% figure for energy efficiency as a top priority suggests that many manufacturers have moved beyond viewing sustainability as merely a compliance issue and now see it as a competitive advantage.

The Skills Crisis Looming Large

The finding that 44% of companies see skills shortages as their strongest opportunity for improvement reveals a deeper structural challenge in UK manufacturing. This isn’t merely about finding qualified technicians—it reflects a broader crisis in industrial knowledge transfer. As experienced engineers retire, companies are struggling to replace both the technical expertise and the institutional knowledge needed to maintain complex automation systems. The fact that engineering expertise was cited as the most valued factor (65%) when selecting systems manufacturers indicates that companies are increasingly looking to external partners to fill their internal capability gaps. This creates both challenges and opportunities for specialized industrial automation providers who can offer deep technical support alongside their products.

Government Strategy Meets Industry Reality

The alignment between the UK government’s industrial strategy and industry priorities represents a rare moment of policy-market convergence. However, the real test will be whether government initiatives can effectively address the skills gap while supporting the transition to more efficient operations. The research suggests that companies are already moving ahead with efficiency improvements regardless of policy support, but the skills challenge may require more coordinated intervention. The danger lies in creating policy that supports energy transition without adequately addressing the workforce development needed to implement it. Companies appear to be signaling that they need help with both technological modernization and human capital development.

Shifting Competitive Landscape

These findings point to a fundamental reshaping of what constitutes competitive advantage in the engineering sector. Where companies once competed primarily on cost and delivery speed, they now increasingly compete on energy performance, system reliability, and maintenance predictability. The 25% who value customized solutions and 10% prioritizing training support indicate a market moving toward more sophisticated, service-oriented relationships. Manufacturers who can offer integrated solutions combining energy-efficient technology with expert support and training will likely capture market share from those offering standalone products. This represents both a challenge for traditional equipment suppliers and an opportunity for those who can adapt their business models.

Implementation Challenges Ahead

While the priorities are clear, the path to implementation remains fraught with challenges. Companies investing in energy efficiency upgrades often face significant upfront costs and operational disruption. The skills gap compounds these challenges, as companies may struggle to find personnel capable of implementing and maintaining new systems. There’s also the risk that companies will pursue quick-fix efficiency solutions rather than comprehensive system optimizations that deliver lasting benefits. The emphasis on maintenance predictability (24%) suggests that many companies are still in reactive mode rather than pursuing proactive maintenance strategies that could deliver greater long-term value.

Future Outlook and Market Implications

Looking forward, we can expect to see increased consolidation among automation providers as companies seek partners with both deep engineering expertise and the ability to deliver customized, energy-efficient solutions. The high valuation placed on engineering expertise (65%) suggests that specialized knowledge will become increasingly scarce and valuable. Companies that invest in developing their internal capabilities while forming strategic partnerships with expert providers will likely outperform those who attempt to go it alone. The convergence of energy efficiency, skills development, and digitalization represents both a significant challenge and a substantial opportunity for UK manufacturers willing to embrace comprehensive transformation.