Where next for British manufacturing?

A combination of cost pressures and government policy has shrunk UK manufacturing in recent decades. Where once the country was a production line of products that were used around the world, now industrial powerhouses are located in emerging countries to the East in Europe and Asia.

Britain’s highly-evolved economy and strong currency means that even menial jobs come at a price and employing a workforce here is many times more expensive than it is in countries whose industrial revolutions occurred in the Twentieth Century, as opposed to the Eighteenth as the UK’s did.

Today, China rules the roost and is the world’s top producer. According to the UN, China’s manufacturing output is valued at more than $2 trillion, much higher than the US and about the same monetary value as Britain’s entire economic output.

By comparison the UK manufacturing industry is small, and if you read the headlines it’s a dying sector. But look at the facts and things appear a little brighter: UK manufacturing makes a £150 billion contribution to the UK economy and employs around eight per cent of the total workforce.

At a recent event organised by Your Ready Business and themed ‘The Future of British Innovation’, a panel of high-profile entrepreneurs discussed the contribution of manufacturing to the UK.

“I think there is a return to craft. The generation in their Twenties are rebelling against instant gratification and not caring where products were made,” said panellist Wayne Hemingway MBE, designer and founder of clothing brand Red or Dead. “There is a real desire to make and craft things. Unfortunately we lost the majority of our capability and skills to compete.”

According to figures published by HIS Global Insight, the UK was still the ninth-biggest world manufacturing power in 2010, behind superpowers like the US and China, of course, but ahead of emerging giants such as Russia, India and Indonesia.

This is all despite a British economy that has been tilted in recent years towards non-production industries such as retail and financial services.

More to the point, the UK industry has retained its position as a leader in world innovation, due in part to its enviable education system and benign political and tax regimes. The UK manufacturing industry is famous for quality and ingenuity, a reputation drawn out by a growing number of niche production companies focusing on robust and sought-after products.

“There has been a throw-away culture in the UK,” agreed panellist Luke Lang, co-founder of crowd funding platform, Crowdcube. “That is steadily changing. One of the companies funded recently on Crowdcube was a company called East End Manufacturing; they were one of the first manufacturing companies to set up in London in the last 20 or 30 years”

“It’s really inspiring for us to help a business like that secure funding. They raised £150,000 and are in their first year of trading with a great management team and plenty of orders. Now they can employ more people and move to bigger premises.”

“Manufacturing is coming back but it’s on a small scale and there needs to be more incentives from the government to foster more manufacturing. It’s not just about huge manufacturing plants in the North East, it’s creating small scale production as well.”

It’s a huge generality, but while China is the go-to place for big orders produced on time and at a competitive price, the UK is looked upon as a country where businesses pay a fair price for products that do a job and are built to last. The British manufacturing industry and especially the clothing sector have been affected by low-priced goods through the years.

“I think we need to see the government promoting British Quality,” said Jo Fairley, co-founder of Green & Blacks. “It’s better to pay a bit more and buy something that is made closer to home and is going to last.”

“There’s a fantastic lighting company called BTC and they make the most beautifully designed lights. They are booming in the UK and they make everything here. For the future of the planet it is that emphasis on quality that we need to foster.”

British manufacturing is not the same global player it was 200 years ago; the world has changed a lot since then. But it is solidifying a genuine reputation for quality and innovation that can be carried on by future generations and make people proud to wear the label “Made in Britain”.