Dianne Sharp: Manufacturing is back in the spotlight

Regional head of the CBI Dianne Sharp wants action on the skills gap as manufacturing could play a huge role in supporting the UK's growth

David Jones/PA Wire Manufacturing

The CBI held our first Manufacturing Conference, Manufacturing our Future – Solutions for Success, at JCB in Staffordshire, last week where, John Cridland, CBI Director-General, stressed the importance of the sector to the wider economy.

Optimism is running high, and parts of the sector are performing strongly – some have even surpassed their pre-recession peak. All this bodes very well, and there is a major opportunity for a manufacturing renaissance to play a significant role in supporting the UK’s growth. But this depends on rebalancing our economy in the right way.

Firstly, we have a golden opportunity to boost exports. Targeting fast-growing markets is the best way to do this, and there are already signs of progress – for example, we now export 30% more goods to non-EU countries than before the financial crisis. We must not forget, or underestimate, how strong our brand is across the world, and how broad the potential is to sell what we do and make.

A second real-time opportunity is reshoring. Shifting global dynamics, changing customer needs and significant inflation overseas, not to mention the hidden costs and risks of lengthy supply chains, have presented many manufacturers with an easy win chance to grow by returning home.

Strengthening domestic supply chains also provides huge opportunities for firms of all sizes. Proximity to key markets is incredibly important, and the potential benefits are enormous – the CBI estimates that strengthened supply chains could create an extra half a million jobs by 2025.

To realise this potential, we have to redouble our international charm offensive and draw inward investment towards suppliers to boost capability and capacity across all parts of the manufacturing sector.

However, securing a manufacturing renaissance is not a racing certainty. Manufacturing is facing major challenges on energy both cost and security of supply. We must diversify and decarbonise, so we’re not relying on any one fuel or technology. And we need to help relieve the cost burden for energy-intensive businesses in manufacturing.

We have to grasp the urgency of the skills crisis, which John highlighted as ‘feeling like a car crash in slow motion’. It’s absolutely critical that skills funding is more closely aligned with the needs of industry, and that the immigration system better reflects the reality of needing to attract international talent, while home grown talent is being developed.

After years of being in the side lines, the manufacturing sector is once again in the spot light and poised to play a major role in the economy of the region and the country. This time we need to do everything we can to ensure that the golden opportunities, which will deliver real jobs in this region, are not squandered.

  • Dianne Sharp is Regional director - North East CBI


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