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Friday, 22 March, 2002, 10:08 GMT
Are UK manufacturers a dying breed?
The UK manufacturing industry has suffered a slow decline over the past 20 years. It is now in recession and any recovery is expected to be slow and painful.
In sharp contrast, the service sector is buoyant, and has been the country's main engine of economic growth in recent years.
Do you think manufacturing is an industry of the past, and of little value to the British economy? Or is actually making things a vital underpinning of the country's economy?
How can UK manufacturers - and their workforces - get more competitive? Would joining the euro save UK manufacturing - or would it harm the economy?
This debate is now closed. Read your comments below.
Forget talk of what can be done to become more competitive, as it is already too late. China and India have no employment legislation and extremely cheap labour. We cannot kid ourselves that technology is the answer; we simply sell this technology and knowledge to them. I do believe though, that niche markets and low volume manufacture is fundamental to the economy of the UK. If this area of industry is to be tarred with the same negative brush by ill informed politicians and media then we, as a nation will regret its seemingly wanton demise for many years to come. Manufacturing and engineering skills should be revered and respected, as once they are lost they will never be replaced. Surely many service industries rely upon manufacturers to survive and therefore are exposed to the same risks.
Am I the only one who sees this as a problem blown out of all proportion? Naturally there are only so many physical goods someone can have and so growth of the service sector is inevitable and part of a trend experienced in virtually every highly developed country. Our wage costs are too high to manufacture many things anyway and given the skills of the workforce why should we focus on basic manufacture? Do we really want Britain to go back to being a sweatshop?
As people become better off, they spend a greater proportion of their money on things that are not physical - i.e. services, experiences, things which make them feel good. Also when people buy a manufactured product, they are often buying the brand values (which don't physically exist) rather than the product itself. The fact that manufacturing is declining relatively is a reflection of our prosperity.
One of the fundamental problems in the UK is the "cheapskate and greedy" phenomenon whereby everyone thinks that they should be paid more and more in their wage packets, but at the same time everyone wants to pay less and less for their goods. The result of this is that companies cut back on quality and make lower grade products, and also seek out manufacturing facilities in places where salaries are lower.
British made goods at one time were extremely high quality, some of the best in the world. But this was at a time when people were happy to save up and pay more for good quality, whereas nowadays people want "cheap cheap cheap" and "now now now". As a result of this I would rank British goods, specifically British consumer goods, as some of the poorest quality shoddy rubbish in the world, and I personally never buy them. I do not regard it was my job to put up with poor quality for the sake of a country that I happen to have been born in.
Peter C. Kohler, USA
Eventually someone will realise that we can't all hold doors open for each other, when this happens the great money go around (i.e., paying the doormen) will stop and the economy will collapse. I'm just saving up so I can emigrate in time.
In my case it is true that the majority of my disposable income goes on services rather than goods. I do spend more on leisure, services, financial products, etc. etc. Most manufactured items in my house are pretty reliable and I simply don't need to replace or repair them very often. It should be no surprise that the economy is structured to reflect these simple facts.
Perhaps we should redefine what we mean by "manufacturing". I'm a software developer. I make things that have a value, which can be used for years, can be exported, and are just as important to the businesses that use them as their physical nuts and bolts hardware. Yet my work is classed as part of the "services" sector, which seems odd to me sometimes.
There is far too much red tape and bureaucracy in the UK, and we would do well to take note of the far-eastern countries who do not continually harass the manufacturing industries.
Keith Simpson, UK
This could well be the end of mass manufactured products in Britain, as other countries have a far lower cost base than us. British industry needs to play to its strengths in areas such as small scale high value engineering as demonstrated by the motor sport manufacturing industry which Britain dominates to service.
Many major firms now operate and manufacture in several European countries. The factories are joined usually by a fast interconnecting train service. To take an example Ford manufacture parts in the UK and then ship them via the Channel Tunnel to factories throughout Europe. Now the Channel Tunnel is closed to rail traffic, it poses a big threat to Ford and others continuing to manufacture in the UK. This is almost the final blow in our manufacturing economy, and we shall have to rely on tourism but for how long will this exist?
Shaun, Teignmouth UK
Manufacturing in Britain is still important. The output of, for instance, the British steel industry is still very high, although with modern technology far fewer workers are required. A large section of the services industry is actually dependent on manufacturing and exports (e.g. translation services). Service industries in my view can only be sustained if there is a manufacturing base. There is a need to keep the economy diversified, that includes manufacturing. We need to strive to be competitive, both in pricing and quality. The fact that this may not be quite so easy to do does not warrant abandoning the manufacturing sector. Much of the current malaise has been the result of the great strength of the pound over the last 4 or 5 years. I therefore believe that trend is by no means irreversible.
Ford Prefect was right: "How can you talk about fiscal policy when nobody makes anything?" Making things is the basis of an economy. It is strategically naive to think we can depend on other countries to make the things we want for us. Joining the euro won't help our exports to the rest of the world - which is bigger than Europe and has less manufacturing competition per capita than Europe. You get the competitive edge by making exactly what customers are willing to pay you for and delivering it when they want it, not by prating about with political economics.
To misquote a couple of sayings, Britain is now a nation of shop assistants and the warehouse of the world. Any pretence at being a manufacturing power is delusional
The main industry in the UK now is the one that manufactures hype and spin. The service sector is buoyant these days because it's fuelled exactly by that. After all, what exactly are call centres or external contractors for? - They're just management consultant methods of displacing direct blame for problems!
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