The Figures That Make a Mockery of Manufacturing’s ‘Decline’
Despite repeated reports of its demise, manufacturing is responsible for more than half the West Midlands economy and nearly a third of the UK output, according to research for Birmingham City University.
The study by the West Midlands Economic Forum suggests manufacturing makes a 53% comparative contribution to the Midlands economy and contributes 30% to the UK as a whole.
The figures, based on estimates about the dependency of other sectors of the UK economy on manufacturing, was commissioned by the University and presented to a fringe event at the Conservative Party Conference last month.
Commenting on the research findings, Beverley Nielsen said: “The research by the West Midlands Economic Forum, commissioned by Birmingham City University, suggests that the comparative contribution of manufacturing, taking into account the direct and indirect contribution through the distributed supply chain, rather than amounting to 14% for the West Midlands and 16% for the East Midlands is more like 53% for the Midlands as a whole, and rather than 11% for the UK is in the region of 30%.
It is clear we need to find better ways to really understand what is happening in the economy rather than relying on existing methods which appear less suited to providing the insights we need for the connected economy. Manufacturing is just not appreciated in terms of the talent we need to recruit or the context we use in discussing it.”
A participant in the event, Paul Forrest, Director at West Midlands Economic Forum, told the event that the current public debate failed to acknowledge the productivity of the West Midlands region. “Export performance in the West Midlands has grown by 30% in the last 2 years which, looking at productivity growth in accordance to Purchasing Managers Index, shows we’re outperforming people in Germany and China.
In contrast to the national economy, where there are arguments that there is an output gap, the big problem in the Midlands is that we’re hitting capacity constraints, in particular in transport and infrastructure. The policy response in the Midlands should be completely different to the national policy response.”
The fringe event, Pipedream or Plausible – a Manufacturing Revival, featured Professor Michael Beverland, School of Management, University of Bath, Vicky Pryce, renowned economist, and Beverley Nielsen, businesswoman and Director Corporate Affairs at Birmingham City University.
Co-authors of a new book, ‘Redesigning Manufacturing’, the three used the fringe to press for an end to the language of manufacturing decline, arguing that the sector has labored under a ‘Cinderella Complex’ for too long.
A FEW WORDS ABOUT THE CONTRIBUTORS:
Professor Michael Beverland:
Michael Beverland is Professor of Brand Management in the School of Management, University of Bath. His previous book, Building Brand Authenticity, identified how the art of making was central to brand longevity. His research focuses on the relationships between branding, design, manufacturing, and firm competitiveness.
Economist and commentator, Vicky Pryce, is currently chief economic adviser with the consulting firm CEBR. She was previously Senior Managing Director at FTI Consulting, director general for Economics at the Department for Business, Innovation and Skills (BIS) and joint head of the UK Government Economics Service. Before that she was partner and Chief Economist at KPMG. She has held a number of academic posts, is on the Council of the Institute for Fiscal Studies, and on the BIS panel for Monitoring the Economy, on the City AM’s shadow monetary policy committee and on the Advisory Board of the central banking think-tank OMFIF. She co-founded GoodCorporation,set up to promote corporate social responsibility and in 2010-11 became the first female master for the Worshipful Company of Management Consultants. She is the author of ‘A Fourth generation Industrial Strategy’ (CentreForum, 2012), co-author of ‘Restarting Britain’ (Design Commission, 2011) and co-editor of ‘Green Business, Green values and Sustainability (Routledge, 2011). Her updated paperback edition of her book ‘Greekonomics’ on the Eurozone crisis was published by Biteback Publishing in the autumn of 2013. Vicky has been a regular visitor to Birmingham City University to speak on manufacturing, design and competitiveness, having served as member of Design Commission and Co-Chair of first enquiry into Design Education.
Director Corporate Affairs BCU. Formerly MD, Fired Earth and Group Director AGA Rangemaster plc manufacturing iconic brands from the Midlands, including AGA, Rayburn, Rangemaster amongst others; Regional Director CBI and CE Heart of England Tourist Board. Involved as director of various businesses today, including as non exec Chairman, Malvern Outdoor Elements, non exec director Aston Reinvestment Trust, ART, and representative on the Design Council Advisory Board. At the 2012 Conservative Party Conference held in Birmingham Beverley launched a survey of 24 companies from all sectors, in her report, ‘Looking for Growth’, suggesting that companies investing in design and innovation skills were outperforming the economy very significantly during the recession, with 50% taking on new people at that time, and exporting on average over 70% of turnover. 96% of businesses felt it was essential for Birmingham and the Midlands to build its reputation for design and innovation.
Research Contributor, Paul Forrest, Economist:
The West Midlands Economic Forum (WMEF) is a neutral, independent forum, bringing together representatives of the public, private and voluntary sectors to evaluate real trends in the local economy. He is director, Sovereign Wealth Focus (SWF), an independent company providing research and analysis of the various forms in which sovereign wealth and national reserve funds are structured and managed.