Get the UK to support an industrial strategy for labour, seeing an increase in investment potential
The Labor Party’s proposed industrial strategy has received strong support from Make UK, the leading trade body for the country’s manufacturing sector.
The organization believes that a well-executed plan could drive billions of pounds in investment and significantly boost UK manufacturing restructuring.
According to research carried out by Make UK, 70% of its members expect the restructuring of their jobs to be accelerated in response to the blue paper of the labor industry strategy, entitled Invest 2035: The UK’s Modern Industrial Strategy. The strategy outlines the workforce’s commitment to providing long-term sustainability for businesses, promising to create a policy environment that encourages planning not just for the year ahead, but for the next decade and beyond.
A key element of this strategy is the establishment of a permanent industrial strategy council, which will ensure policy coherence and prevent short-term changes that tend to undermine industrial planning. The strategy also focuses on supporting eight key growth sectors where the UK excels: advanced manufacturing, clean energy industries, creative industries, defence, digital technology, financial services, life sciences, and professional and business services.
Great growth potential for UK brands
Make the UK believe that the potential impact of Labour’s strategy can be transformative. The agency estimates that UK manufacturing, currently estimated at £217 billion, could grow to 15% of GDP, adding another £142 billion to the economy. Current investment in the industry stands at £38.2 billion a year, but Make UK suggests that repatriating jobs overseas and boosting UK-based investment could significantly increase that figure.
Faheen Khan, senior economist at Make UK, expressed excitement about the opportunities presented by the strategy. “Manufacturers are ready to start for the government to reveal the benefits of investment that will be brought about by the firing of the long-awaited industrial strategy,” he said.
Khan highlighted the benefits this will bring to the sector, especially in terms of automation and digital technology, as well as the employment of highly skilled workers. He also pointed out that as the US, Europe and China increase their investment in green technology, the UK needs to move quickly to remain competitive.
Priority for manufacturers: investment, automation, and exports
Make UK’s survey of its members revealed that industrialists have a clear set of priorities, including greater investment in UK facilities, more automation, and an increased focus on research and development. Manufacturers also see exports as a key growth area, with a strong push to increase trade with the European Union in a post-Brexit environment.
Financial benefits are high on the agenda, and more than half of respondents indicate that a reduction in corporate tax will have a significant impact on investment. An increase in cash allowances for software installation and extending the full cost of leased and supported equipment were also seen as key steps to boost investment in the industry.
Barriers to investment: high interest rates and fiscal measures
Despite the optimism surrounding Labor’s industry strategy, manufacturers face significant challenges, particularly high interest rates. A UK survey found interest rates to be the biggest barrier to investment for many companies, and there is hope within the sector for further easing by the Bank of England to ease this pressure.
Manufacturers also emphasized the importance of keeping up with international efforts, especially in green technology. As the US, Europe, and China move rapidly to increase investment in green industries, the UK must keep pace to ensure its long-term global competitiveness.
