12 Oct How Manufacturing Can Restore The UK Economy
Manufacturing will play an enormous role in restoring the UK economy following the Coronavirus pandemic.
As we enter the final quarter of 2020 we can take stock of what has happened and how we will move forward from our current situation.
Historically, the Second World War left Japan’s economy in disarray. Key industries were brought to a halt and there seemed to be no end in sight. Then in the 1950’s, American businessman William Edwards Deming taught Japan’s manufacturers how to produce high-quality products economically.
The Japanese learnt quickly and rapidly manufactured to became world-class producers in their fields. This turned the global economy on its head, beating foreign industry at its own game. From its post-war hardship, manufacturing inspired Japan’s meteoric economic rise. It was the spark which ignited the economic miracle.
Fast forward to 2020 and the UK is staring down the barrel of the worst recessions in history. The coronavirus pandemic has brought about unprecedented challenges, with the British government tasked with the unenviable balancing act of protecting public health, while trying to keep the economy from breaking.
As lockdown came, the economy suffered its hit on record. The economy shrank over 20 per cent compared with the first three months of the year, leading to the first recession in over 12 years.
As the nation cautiously balances between continuous local lockdown measures still in place, getting the economy moving once again is paramount. At the heart of all this manufacturing can be an incredible powerful source for economic growth and prosperity, rebuilding our nation and leading the way for the future.
Luckily the manufacturing industry has not been decimated by the pandemic. As a supplier to key industries including medical devices, pharmaceutical, chemicals, and defence sectors, Constant Group have remained strong throughout. The manufacturing sector has risen to the challenge of the nation, with quick PPE response, ventilator manufacturing and increased production across our varying sectors.
Manufacturing can be a core staple of the British economy. In 2019 – 2020 the manufacturing sector’s annual output accounted for £192bn to the UK’s economy. The industry accounts for 47 per cent of exports and 66 per cent of R&D investment. Over 2.7 million are employed in the industry, with the average salary in the sector standing at £33,5000 – 13% higher than the rest of the nation.
As we transition into the new normal, Constant Group moves forward with increased connectivity, advanced analytics, automation, and advanced manufacturing technologies was gaining momentum before Covid-19, helping companies transform their operations in everything from production efficiency to product customisation, with improvements in speed to market, service effectiveness, and new-business model creation. It can help the industry lead the economic charge.
While growth in the sector since lockdown have been linked to the healthcare industry, other areas of potential growth are definitely emerging. Chancellor Rishi Sunak vowed to spend a record £600bn on infrastructure over the next five years. Placing the UK’s manufacturers at the heart of delivering this will be key to ensuring Britain can thrive post-Covid-19. Meanwhile, the automotive, textiles, electronic and aerospace sectors are all expected to see output growth on 2019 levels by 2021.
The industry has all the infrastructure to hit the ground running, manufacturing already has the tools at its fingertips to lead Britain’s recovery. It has all the instruments available to promote Job growth, production and R&D investment. The limited reopening of the economy in May, that accelerated in June, saw strongest growth in manufacturing and construction where workers were able to return to factories and building sites.
Manufacturing has a monumental cog in the UK’s economic engine. Ensuring the sector takes every advantage, from government support and investment to collaboration among industry leaders, will continue to drive this growth. Together we will be crucial in manufacturing Britain’s recovery.
Contact Constant Group today to see how we can improve your process.