From the TUC

Knowledge, creativity and industry

23 Dec 2009, by in Economics

The Times is in bullish mode this morning. It’s editorial, ‘Creative industry‘, starts controversially: “Few phrases strike more fear into British business than ‘industrial policy'”, it opines. Really? I was heartened to read how Lord Browne, former boss of BP and for so long one of the UK’s top industrialists, praised the interventionism of Tony Benn, of all people, earlier this year. “If the Government had not got involved, a lot of vital infrastructure would have been produced outside of Britain”, Browne reminded us.

Nevertheless, The Times editorial gets over its poor start with a thought provoking piece about the way in which the UK might pay its way in the global economy of the future.

The Times pins its colours to the masts of biotechnology, pharmaceuticals and sophisticated engineering, as well as the so-called “creative industries” – design, software, computer games etc – which utilise “the application of brain power”.

“Manufacturing was more than a fifth of the economy 20 years ago. Now it is less than one eighth”, according to The Times. “But this, in itself, does not mean the economy is ‘unbalanced’. Manufacturing is roughly the same share of the economy in the UK as it is in France and the US. In any case, outside the aerospace, defence and biotechnology industries, manufacturing is stuck in a trap of low value and low skills.”

There are three things to say here. First, it is good to see The Times nudging its way towards knowledge based industries. This editorial goes on to praise financial services, yet more attention to knowledge sectors of industry by serious commentators like this newspaper is to be welcomed and is part of a trend within UK dialogue around economic policy at the moment. I hope it continues.

Second, it is plain wrong to say that manufacturing outside of defence, aerospace and biotech is low skill and low value. To be sure, we have too much low skill, low value industry in the UK, after many years in which employers could dodge their responsibility to train and short-termism gripped our economic fabric. But many other industries are either highly skilled or can become highly skilled with the right government support. Motor cars should remain a major part of UK manufacturing. A new generation of greener cars will require huge ingenuity and couldn’t possibly be described as low skilled. The trick will be to harness the knowledge that The Times admires so much and apply it to modern manufacturing.

Third, if manufacturing in the UK is similar to that in France and the US, why is our narrative so different? If I had a pound for every time somebody tells me that the UK has no manufacturing left, I’d be a rich man, yet France and the US shout loud and proud about their manufacturing sectors. They haven’t given up the game. Neither should we.