Manufacturing: The challenges ahead

With the manufacturing sector continuing to grow faster than the economy as a whole, Simon Pollard, president of the Manufacturing Technologies Association (MTA) and MD of Kyal Machine Tools looks at what's needed to further boost momentum

As I write, news has just been released of economic growth in the UK over the first three months of 2011 - albeit by 0.5% - led by manufacturing which grew at a rate of 1.1%. This confirms what we in industry already knew.Manufacturing is continuing to lead the way out of a trough we fell into and is the key part of the economy that is taking us forward.

It's been a difficult few years.When the crash came, though not of our making, it hit our sector hard - but the fact remains that manufacturing matters and the UK is a great place to manufacture.

Helped in part through the MTA's representation, it seems the Government 'gets it' too.Within weeks of the coalition government coming into power, we were visited at our manufacturing technologies show - MACH - by Ministers Vince Cable and Mark Prisk. They were impressed by what they saw and by the arguments that we made to them. The tide has to turn, and I think it is turning.We are beginning to get a new message out there; that the UK is a great place to manufacture - the numbers are such that no one can be in any doubt.

Manufacturing continues to grow faster than the economy as a whole - it is pulling the country's economy along.

The MACH show in 2010, for most exhibitors, exceeded targets and put smiles back on faces.More importantly, it put salesmen back on the road chasing leads. The show in April 2012 will be geared to achieve this same goal - driving sales for the forthcoming two years.

I'm not going to over sell this.We are not about to return to the days when we were the workshop of the world but I believe that there is more afoot than just a re-appraisal.

Politicians now recognise that a real economy is not lighter than air - unless you are in the supply chain for the new generation of airships of course.

I know of companies who have been repatriating work from overseas, and of companies who have invested significant amounts in bringing the best of modern technology into their factories because they believe that they can make the best of modern manufactured goods in this country.

I believe passionately that for manufacturing to have a future in this country we must be strong enough to take on increasing competition. The landscape of the world economy is changing at a pace unseen before. Countries which only a generation ago barely registered on global GDP graphs have overtaken the established industrial nations, including our own.

I mention this not in a spirit of doom and gloom, but in recognition of the challenge that it presents. A challenge which highlights great opportunity. Our heritage as a trading nation with global links will stand us in good stead to enter into new markets and carve out new niches as the emerging economies come into their own.

British manufacturers can only compete when manufacturing technologies are the best. This will be when we have the best products, offer the best service, are the most flexible and when we have a skilled and agile workforce that understands the industry.

Of course we all know how important the skills of our people are to the future of the industry. The MTA has long believed in fostering excellence and growing our skills base, and as such we offer financial support and advice to our Members to fund training and apprenticeships - the lifeblood of the industry. For the UK to be a great place to manufacture we believe that investment is the key. That's investment in kit, people and R&D. That applies right across manufacturing - from satellites to Scotch whisky.

We know that UK business does not have a good record on investment. It's not because British businessmen and women are shortsighted, and it is not because there is some mythical cultural barrier to investing. It is because in comparison to other countries the financial support is not there.We are fighting in the global market with one hand tied behind our backs. Our tax system is not properly designed for manufacturing.

The Government has an aim to make the UK Europe's leading manufacturing nation.

However, at the moment, it is just that - an aspiration. Government support needs to be made real.We're not standing here with our begging bowls, but we do want a fair crack of the whip from Government. The changes announced in the budget to extend the short life scheme for high tech capital assets are welcome but, by themselves, are not enough to kick start investment we need.

The financial services sector should be a source of strength for the whole of the UK economy, including manufacturing. Just think of the competitive advantage we'd gain if some of those big beasts of the city turned their hands from financial engineering to finance for engineering.

We will keep pressing the case with Government and continue to work with Members and stakeholders to make sure the UK remains a great place to manufacture.