It has been a sober start to 2015 for manufacturers with many predicting that fortunes will worsen in 2015, an industry organisation has warned.

EEF, the Engineering Employers’ Federation, says just 37% of factories expect trading conditions to improve this year, down from 70% in the same survey 12 months ago.

Meanwhile 17% expect conditions to deteriorate compared with only 5% saying the same last year.

EEF described the mood as “cautious” with optimism tempered by a “hefty dose of realism”. Concern about the global economy are front and centre in the minds of business owners and managers.

Terry Scuoler, chief executive of EEF, says: “Manufacturers’ confidence at the beginning of last year was very high - one year on and, while still positive, it has very evidently eased back.

“The realities of 2014 have taken the edge off future forecasts and what we are now seeing as we head into 2015 is a far more muted outlook, tempered by a backdrop of difficulties in the EU and wider geo-political concerns.

Scuoler added that the looming general election in the UK was adding to uncertainties: “The sector is still making good strides, but confidence can be fragile and with an election on the way it is vital that uncertainty and disruption are kept to a minimum.

“Recovery is by no means guaranteed and we would urge party leaders remain focussed on delivering a fully balanced, stable economy where manufacturing is enabled to expand and grow,” he added.

In other findings from the research, top priorities for manufacturers include improving marketing and branding, cited by 46% of respondents, launching a new product or service, with 44%, and consolidating activity in the UK, with 36%.