Manufacturing: the great comeback?

Saturday 20 October, 10.30am until 12.00pm, Garden Room

Manufacturing has long been argued to be the heart of any modern economy. It produces valuable exports, boosts the balance of trade, provides skilled jobs and generates even more jobs in supporting service sectors. Yet many developed economies have seen the weight of manufacturing in their economies decrease since the 1970s, relative to services and finance. In Britain, the service sector today arguably is the economy. Since the financial crisis hit, however, there have been many calls for a ‘rebalancing’ of the economy towards making things again, towards production and away from consumption. Is it realistic or desirable that Britain tries to emulate Germany’s famous ‘Mittelstand’ of export-led medium-sized firms, and its engineering prowess?

John Cridland of the CBI has called for banks and government to support Britain’s own ‘Midlandstand’ while Blue Labour’s Maurice Glasman argues for reforms on the German model: workers’ representation on company boards and vocational training. In short, an industrial policy. And Britain still has real strengths in sectors like aerospace, robotics, pharmaceuticals and automobiles. Already this year Jaguar Land Rover has announced plans to generate 4,500 manfacturing and engineering jobs. Weaker sterling and higher Chinese wages coupled with a desire to keep supply chains closer to home also bring hope to some that British manufactures might sail the seas once more. American manufacturing has bounced back since 2008, led by the likes of General Electric, Procter & Gamble and Hewlett-Packard. Today the talk is of ‘reshoring’ not ‘offshoring’. Germany though has seen its share of industrial production fall. German business also benefits from wages that have stayed low, while its exports have been boosted by a low Euro. Some criticise Germany for a ‘beggar-thy-neighbour’ policy of allowing its exports to dominate the European single market when it should be encouraging greater domestic consumption. China too is advised to produce less and consume more. That might simply be a matter of better balance, but there is also a wider backdrop of criticism to the idea of making things: the arguments that natural, particularly mineral, resources are scarce; that factories pollute.

Can Britain reengineer its economy towards production for export again? Could new technologies like 3D printing move from the level of the hobbyist to usher in a new industrial revolution? How could such a shift even be brought about in an economy where businesses still seem reluctant to invest, where the banks won’t lend, and government, despite being a safe haven in the bond markets, seems to lack the will power to drive through sweeping changes in infrastructure that might support a manufacturing surge? Just what is the right balance to strike when it comes to the question of making stuff?

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Andrew Bergbaum
director, AlixPartners; manufacturing industry consultant

Peter Marsh
manufacturing editor, Financial Times; author, The New Industrial Revolution: consumers, globalization and the end of mass production

James Matthews
management consultant; founding member, NY Salon; writer on economics and business

Mike Wright
executive director, Jaguar Land Rover

Martyn Perks
digital business consultant and writer; co-author, Big Potatoes: the London manifesto for innovation

Produced by
Angus Kennedy convenor, The Academy; author, Being Cultured: in defence of discrimination
Martyn Perks digital business consultant and writer; co-author, Big Potatoes: the London manifesto for innovation
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