Manufacturing miracle at risk
LITTLE known fact: this country is very good at manufacturing. The old joke was that ‘British industry’ was an oxymoron, but not any more: we are far better at advanced manufacturing than is commonly realised.
The public thinks the UK is only the world’s 56th biggest manufacturing nation. We are actually number nine, a position that should be a source of national pride. It’s certainly a minor miracle we are punching so far above our weight.
The misperception about manufacturing probably stems from the 1980s, when the old heavy industries began to wane. A leaner, high-tech, highly-skilled sector that could assure our prosperity after Brexit has risen phoenix-like from those ashes.
The aerospace industry is a case in point. It is heading for a production record this year, with aircraft delivered so far worth up to £18bn. British manufacturing is a remarkable success story that we should be shouting from the rooftops. But instead of capitalising on this success, firms of all sizes feel embattled not only because of Brexit but also the spectre of a Jeremy Corbyn government, with the prospect of re-nationalisations, higher tax and higher spending.
On Brexit, most manufacturing firms don’t seem to have received the memo that it will be a glorious release from red tape and an opportunity to forge trade deals in far- flung parts of the world. Rightly or not, they are deeply pessimistic. So much so that one in six of those questioned in a survey by industry group the EEF say their business would be untenable if the UK reverted to World Trade Organisation rules. Forty-three per cent said they could see no positive opportunities whatsoever from Brexit. BREXITEER
politicians reject warnings from the leaders of Airbus, BMW and Jaguar Land Rover as Remoaner bleating. But the owners of small and medium firms who responded to the EEF are not part of an unrepresentative corporate elite who are in hock to the EU – they are hard-headed business people trying to run companies in places like Newcastle and Birmingham.
There are 150,000 small and medium British firms that only export to the EU.
Blithely waving aside their fears and telling them to sell more to the Koreans and the Chinese could be the answer – but only in the long term, provided of course firms are not strangled for lack of working capital in the meantime. The situation is equally bad if not worse in the services sector, including financial services, which some very senior figures feel gets less of a hearing from the Government than industry does.
Regardless of how they voted in the referendum, many business people are becoming ever more anxious and frustrated by bickering and back-stabbing politicians.
They fear not only a botched Brexit, but that the self-harming antics in the Conservative Party will usher Corbyn into Number 10.
Brexit is crowding out other important long-term discussions about skills shortages, lack of investment, and too few women in engineering.
The basic duty of government towards business in a well-functioning capitalist society is to provide a stable political and economic backdrop so firms can be confident to plan and to invest.
In the internecine and interminable Brexit battles, the Conservatives, who should be the party of business, are in danger of forgetting that.