Manufacturers call for a ‘rebalanced’ economy

MANUFACTURING in the UK has a perception problem – and one which threatens to destroy its future.

Armchair pundits decry the end of manufacturing in this country and talk about the post-manufacturing society.

But those who work in manufacturing – more than 3m people in the UK – can attest to the very real role that manufacturing still has.

David Ost, EEF’s North West regional director, said: “There is a general misconception we’ve lost our manufacturing base – yet the UK is the sixth-largest manufacturing economy in the world, and the North West makes a huge contribution to this.

“It’s time to debunk this myth once and for all, and that’s why we are staging Manufacturing Week this week and this debate helping to tell the story of the industry’s success.”

Manufacturing Week is supported by a number of groups, including the Northwest Development Agency (NWDA).

Steven Broomhead, chief executive of the NWDA, said:Š“The North West’s manufacturing sector is the biggest of any English region and remains a major driver for improving GVA, contributing almost £20bn to the regional economy.

“Manufacturing Week is an excellent opportunity to promote the strength of the north-west manufacturing sector.

“The NWDA is working with partners across the North West to create a modern manufacturing sector in the region that will be innovative, enterprising, highly-skilled, and well-led, and this week is providing us with a platform to shout about it.”

The week’s events, which culminate in the publication of EEF’s manifesto for manufacturing, will look to build on a clamour within the industry for the UK economy to be “rebalanced” – for much greater importance be put on manufacturing in the future with no meek surrender to the perceived threat of the low-wage economies.

Sir Alan Rudge, former deputy chief executive of BT and chairman of WS Atkins, and currently chairman of the ERA Foundation – which supports activities that help bridge the gap between research and exploitation in electrotechnology – is one high-profile advocate of this rebalancing.

He said: “We as a nation have to stop deluding ourselves that Britain is leading the way into a post-industrial society where manufacturing is unimportant and where we can pay our way by means of services alone.

“The experiment of the past decade has clearly demonstrated that this is folly: the anti-manufacturing culture that has prevailed here has been very damaging.

“The time has come to clear away the smoke and mirrors, to acknowledge that our economy is seriously out of balance and to do something about it.”

Sir Alan argued that the problems within the sector are not the result of the global recession, but are linked to cultural attitudes to manufacturing.

He said: “The current fiscal disaster may so dominate the present that we forget the underlying problems were there before the crisis.

“We are weaker now because of our neglect of them.

“We will undoubtedly return to an even worse situation unless we tackle the problem of our trade deficit with great urgency. Above all, we can start to reverse the negative culture on manufacturing and productive industry.

“Why would anyone want to invest their career or their money in a manufacturing business if they are constantly being informed that manufacturing is the past, old hat, dying, and the future lays elsewhere?

“For the UK, the chips are down. It really is a case of ‘export or die’. Expanding the nation’s productive industrial base – from start-ups to major businesses – must become a major mission for the next generation, Government and people alike.”

The EEF – which describes itself as “the manufacturers’ organisation” – has previously called for a “better-balanced, better-equipped economy” in its report, Manufacturing Our Future.

It said: “The need to redress our existing imbalances and prepare for our challenges is clear, but building a better-balanced, better-equipped economy in practice will require difficult choices.

“The UK needs an economy that is diverse enough to prevent the future build-up of economic imbalances.

“The focus must shift to a more diverse, agile and innovative manufacturing base – the sector that’s able to provide many of the solutions to the UK’s future challenges and, consequently, the goods and services exports needed to close the trade deficit and underpin future prosperity.

“Put simply, the UK Government needs to focus its efforts in order to stimulate and encourage the production of goods and services that allow us to pay our way in the world.”

The EEF emphasised that it sees the sector – and the UK economy – as at a crucial point in its development. The report added: “Just like manufacturing at the start of this decade, the UK economy sits at a crossroads.

“We can either blindly believe that the economy will ride out the recession and return to business as usual, or we can learn from the lessons of the past ten years and take action.

“The former implies a return to myopic, debt-fuelled growth and a gradual but inevitable collapse in national competitiveness. The latter requires manufacturers and politicians to make tough choices and take decisive action to restore our economic competitiveness in the future.”

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