Growth plan

Despite what some people think, the UK remains one of the world’s leading manufacturing nations. Industry generates £140bn a year to the economy, and it accounts for 55 per cent of the UK’s total exports. But in recent years there has not been the long-term planning across government that’s needed if we are to support UK manufacturers to compete in the global marketplace. So, last year we launched the Advanced Manufacturing Growth Review, a root-and-branch analysis of the barriers to growth, and the structural reforms needed to encourage a balanced, sustainable economy.

We are seeking to speed up the commercialisation of new technologies, by investing £200m in technology and innovation centres; also, we are boosting competitiveness with funding for the Manufacturing Advisory Service (MAS). And we are backing SMEs looking to export more, by setting up an export enterprise finance guarantee scheme, which will underwrite finance worth up to £1m for individual small firms.

Changing people’s negative perceptions of industry really matters. It is essential if we are to rebalance the economy and if industry is to be able to recruit the skilled workforce it needs. Take the need for graduates in Science, Technology, Engineering and Mathematics (STEM). Around 43 per cent of those who graduated in 2009 did so with a first degree in a STEM subject - yet just 5 per cent went to work in manufacturing. In other words, many young people who have the potential skills industry needs are going elsewhere. They don’t see their careers in engineering or manufacturing.

My department is hosting a series of exhibitions promoting UK firms and their products. Among other things, we have already exhibited a zero-carbon motorbike and Airbus wing components made out of composites. In addition, we recently announced plans for a week of factory ’open days’ right across the country, to help redefine manufacturing’s public image and raise its profile.

And we can do that in part, by nailing the myth about low salaries being the norm in industry. There is a common misconception that engineers are poorly paid when compared to other popular choices, such as accounting or the City. In fact, skilled engineers enjoy comparable levels of pay.

According to the Office for National Statistics, the median salary for professional engineers is slightly more than £36,000 a year - that is in the top 30 per cent of UK salaries, and 40 per cent above the median national salary. And as their careers progress, experienced engineers can expect to rise even higher up the income scale. Last year, the median annual salary for an experienced chartered engineer was £55,000. But young people just don’t know this. So we - government and industry - need to spell out to them that if they are looking for a well-paid, skilled job with good prospects, manufacturing and engineering offer a wealth of opportunities.

It’s not just a question of attracting young people into the sector. Once they have started, industry must ensure they get the training they need. So we are transforming the skills and further education system in order that industry can meet that demand. We are setting further education colleges free from bureaucratic control. We want to ensure they support economic growth by responding to the needs of employers and learners. Our aim is to empower employers to shape the skills system, not just advise on how it should look.

We are also committed to creating a new generation of University Technical Colleges. Students with technical aptitude should have the option of starting vocational training from the age of 14, alongside their core academic education.

It’s important we get this right so we can ensure that a reinvigorated manufacturing sector is, once again, at the heart of a strong and balanced economy in the UK.