16 May, 2022

The figures that make a mockery of manufacturing’s ‘decline'

07 November, 2014

Despite repeated reports of its demise, manufacturing is responsible for more than half the West Midlands economy and nearly a third of the UK output, according to research for Birmingham City University.

The findings came as The Office for National Statistics hosted a major event on The Changing Shape of UK Manufacturing. The study by the West Midlands Economic Forum suggests manufacturing makes a 53 per cent comparative contribution to the Midlands economy and contributes 30 per cent to the UK as a whole.

The figures, based on estimates about the dependency of other sectors of the UK economy on manufacturing, was commissioned by the University and presented to a fringe event at the Conservative Party Conference last month.

Commenting on the research findings, Beverley Nielsen, businesswoman and ‎director of corporate affairs at Birmingham City University, said: “The research by the West Midlands Economic Forum, commissioned by Birmingham City University, suggests that the comparative contribution of manufacturing, taking into account the direct and indirect contribution through the distributed supply chain, rather than amounting to 14 per cent for the West Midlands and 16 per cent for the East Midlands is more like 53 per cent for the Midlands as a whole, and rather than 11 per cent for the UK is in the region of 30 per cent.

“It is clear we need to find better ways to really understand what is happening in the economy rather than relying on existing methods which appear less suited to providing the insights we need for the connected economy. Manufacturing is just not appreciated in terms of the talent we need to recruit or the context we use in discussing it.”

A participant in the event, Paul Forrest, director at West Midlands Economic Forum, told the event that the current public debate failed to acknowledge the productivity of the West Midlands region. “Export performance in the West Midlands has grown by 30 per cent in the last 2 years which, looking at productivity growth in accordance to Purchasing Managers Index, shows we’re outperforming people in Germany and China.

"In contrast to the national economy, where there are arguments that there is an output gap, the big problem in the Midlands is that we’re hitting capacity constraints, in particular in transport and infrastructure. The policy response in the Midlands should be completely different to the national policy response."

The fringe event, Pipedream or Plausible – a Manufacturing Revival, featured Professor Michael Beverland, School of Management, University of Bath, Vicky Pryce, economist, and Beverley Nielsen.

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