Monday, 5 December 2011

Apparently The UK doesn’t make things any more

“And was Jerusalem builded here,
Among these dark Satanic Mills?”
-William Blake

So often you hear people decry the lack of manufacturing in the UK and the loss of our industries. Whilst I was perusing the offerings on the box last night I caught the end of Robert Peston pontificating in his usual irritating manner about the crisis in the UK. At one point a middle aged man was seen outside a factory in a high visibility jacket lamenting the loss of British industry. This was of course a lie! If one stayed tuned for the next show “how to build it” you would see the answer to the shift in British industry.

I won’t bore you with the details save one can catch the show on Iplayer in its entirety but this fascinating insight into the extremes of modern manufacturing highlighted exactly the kind of economic strength that Britain has in manufacturing. The show followed the story and the assembly of the Rolls Royce Trent jet engine. What it highlighted is the staggering level of R&D, craftsmanship, use of advanced materials and complex logistics that go into the endeavour of creating efficient, modern jet engines. One could see highly trained and skilled welders, research engineers and logistics managers at work in the factories – the kind of jobs their parents would be proud of them having. And Rolls aren’t the only British business making cutting edge quality goods; Range Rover are opening a new factory to build their Evoque mini 4x4, JCB are still hard at it making diggers, EADS make the wings for the A380 in the UK and most of the Formula One industry is developed in the UK.

It seems to me that the popular sentiment is that Britain does not make anything anymore. It is not hard to see why with the closure of so many factories and the loss of many businesses (MG Rover being a recent example). But with all the textiles industry, coal mining, potteries and steel mills closing over the last few decades people decry the loss of UK manufacturing. However how many parents would want their children working in a pottery? Mining Coal? Shovelling cement into bags? I am sure that people want to see their Children grow up as skilled graduates or apprentices designing the next generation jet engine fan blade or welding the fuel piping system of an A380 wing. These jobs require skills and education such that one can take pride in one’s work. Do people really want to return to the dehumanization of the industrial age with its dirt, grime and monontonous assembly lines? In many ways the service economies growth in the last 30 years has been a process of rehumanization bringing us closer again to the totality of human potential.

People don’t see the shift in society in the last 30 years from an industrial to a service based economy. I ask you how many times a year do you buy capital goods such as a kettle, a television or even a car? Not very often. In the past this was the basis of the economy. Today our lives are more complex. We demand more and we achieve more; instead ask how many services you consume in a year? How often do you fly abroad? Go for a massage? Require childcare? Take a languages course? Read a website? Enjoy a television programme? These things are services and just because you can’t lay your hand on it it doesn’t mean it isn’t produced and usually, by virtue of the fact of it requiring interpersonal exchange, these services are made in the UK. In fact the UK exports a huge amount of services to the rest of the world whilst it imports capital goods. I see no harm in this for a globalised economy.

The great trial of our times seems rather on how to mobilise, retrain, re-educate those whose skills are barely above the common Chinese labourer and whose costs of livings are substantially higher. This is the dark side of globalisation; the economic dislocation of those who cannot compete in the globalised age. It is here that the government should be focussing their energies on employment and development ensuring that high skilled jobs and training continue to make the UK a global power in manufacturing of high value added and high worth goods. The idea that we should return to the labour intensive industries of the last century as some kind of golden age whilst decrying the ‘sweat shops’ of Bangladesh seems absurd!

Growth in of course a virtue for the economy bringing more opportunity and better living standards but as we all know from experience growth is also painful.

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