The recent ‘The Engineer’ article

highlighted three crucial aspects for next week’s Brexit negotiations which included low tariff trade deals, access to skilled EU workers and training/education incentives for domestic workers. In the article Caroline Milton, Head of Manufacturing at Menzies LLP explained, “SME manufacturers are already considering their options with plans to shift or acquire operations in Europe.” Trade tariffs have been high on the agenda since the head of Germany’s largest business group, the BDI claimed that relations with the rest of their trading counterparts were more important than with the UK despite the obvious strongholds such as UK/German automotive exports. This will certainly not go away and remains a focal point for next week’s discussions as previous tax cuts and reliefs to encourage EU investment is threatened by a ‘hard’ Brexit.

Key aspects in achieving this have to include training and skills development, and investment as any migration would also surely involve the very best talent. The article mentions that a recent Science and Technology Committee study outlines that the digital skills gap is already costing £63 billion in lost GDP and highlights STEM initiatives as being crucial in closing this gap. As a people business which is focused on providing the very best talent to the technical markets including energy, construction, engineering and manufacturing industries, we strongly feel that the allocation of funding to such skills initiatives is critical in keeping and continuing to attract the top talent to these shores. Within our sister engineering companies, Texkimp and SECC, attracting talent from both academic and wider geographic areas has always been key to our broader success. Attracting employees from 4 different European countries and a Knowledge Transfer Partnership (KTP) with Manchester University are prime examples of the successes attained in our pursuit of excellence. This must continue and next week will be a key milestone in our future.

Garry Rogerson MD

On 18^th November the UK government

ratified the Paris Agreement to mitigate CO2 emissions from 2020.  Greg Clarke, Secretary of State for Business, Energy and Industrial Strategy (BEIS) is hailing this move as a “clear signal that cutting emissions globally will not only help countries respond to the impact of climate change, [but one that] is also compatible with economic growth.”

However, Mr Clarke is guilty of limiting the UK’s economic growth by delaying the announcement of the government’s energy policy and their subsequent priorities for reducing carbon emissions through new power generation projects.  The government’s lack of focus on energy in the Autumn statement frustrated many businesses, leading the CEO of Inenco Group, Gary Stokes, to write an open letter to Mr Clarke, stating “Businesses were hopeful that the Autumn Statement would deliver more clarity, from the future of the Carbon Price Support, to the cost of supporting low carbon technology beyond 2020 and were left disappointed at the lack of focus on energy.”

Like many businesses focused on the UK energy sector, Perpetual Partnerships is hoping that the government will provide clarity on how it plans to meet the obligations of the Paris Agreement and allow the sector to move forward with new projects sooner rather than later.

The landscape and main features of the UK’s industries and manufacturing have changed beyond all recognition over the past two centuries – and in turn, these have wrought massive transformations in the lives of the people involved in them, and on the communities in which they live.

In the main, these advances have been focused on new and improved means of production, along with improvements in materials used in manufacturing processes, which in turn have brought about many less labour-intensive and safer methods of manufacturing many of the goods we use but often take for granted in our daily lives.

Early Days To The Present Day – How Far Have We Come?

According to the national census of 1841, 36% of the UK population worked in manufacturing. By 2011, that figure was down to just a quarter of this proportion, reflecting a major shift away from labour-intensive types of manufacturing to more skilled and specialised fields.

And whereas in the 19th century, there were various pockets of manufacturing spread widely across the country, by the early 21st century, the country’s remaining manufacturing capacity had become heavily concentrated in particular areas, with Corby, in Northamptonshire in the East Midlands boasting the highest proportion of its population working in manufacturing, at 23.7%, or nearly one in four of the town’s entire workforce.

Today, manufacturing is generally on a much smaller scale, and because of this, it has become part of a much broader base of communities throughout the country.

And whereas much manufacturing in the British Isles in the 19th and 20th centuries was heavy, labour-intensive work, today there is much more emphasis on smaller, precision-made items – and indeed, one of the biggest growth areas of the next few years looks set to be in nano-technology, whereby the items manufactured are measured in tiny fractions of an inch or centimetre – to give you some idea, one inch (2.54 centimetres) is equal to 25.4million nanometres.

But it isn’t just in terms of scale that we can measure how manufacturing has progressed over time. Oxford Economics has singled out the main current drivers of change in manufacturing as ‘Big Data”, the internet of things, mobile computing, and the cloud.

Other Big Landmarks

Professor Pat Hudson collaborated with the BBC in 2011 on a series called The Workshop Of The World, which examined how Britain came to earn that title.

He pinpointed technology as one of the main drivers of change, but also the fact that ways in which production was organised helped the nation keep its place as a major economic power. In turn, the latter helped bring prices down, meaning that the new machinery started to come within the means of the average household.

The 1790s to 1860s were years of massive change in the way industry was financed, and parallel population growth also meant the plentiful availability of labour for the new industrial processes which were coming to the fore.

While in the early part of this period, canals were the main transport arteries for getting goods from A to B, by the end of this time, the period which historians call The Railway Age was in full swing. The new steam-powered engines hauled passenger carriages and freight wagons, and provided fast, direct connections between all major towns and cities, as well as linking more isolated communities with their main markets.

However, there were huge differences in the relative pace of industrialisation across different parts of the country – and even though the stereotypical picture of the industrial landscape at this time is of many hundreds of workers toiling away in huge, warehouse-style factories, much production remained on a very small scale, which gave rise to the phrase ‘cottage industries’, which we still use today to describe businesses which operate at a micro level.

Today, the pendulum has swung the other way, and while there has been a huge decline in the number of people working in manufacturing – the sector employed 36 per cent of the working-age population in 1841, but by 2011 that had shrunk to nine per cent – that statistic alone paints a distorted picture.

Overall, manufacturing has grown by 1.4 per cent a year since 1948, according to the government’s number-crunchers at the Office for National Statistics.

Small Is Beautiful (Again)

But this growth has largely been achieved against a backdrop of a return to smaller-scale manufacturing – with many businesses working in highly-specialised fields and employing far fewer staff than their large predecessors.

Rather than trying to compete with the new, emerging industrial nations such as China, Russia and India – where the UK is at a massive disadvantage in terms of the size of its available workforce, which means these countries can produce many basic necessities, such as coal, iron and steel, far more cheaply – the UK has therefore shifted the focus of its industrial base to production of specialised items, and those which are in greatest demand in the world’s most developed nations (sometimes referred to as the G8).

One of the biggest ‘new’ sectors to have emerged in recent times is the manufacture of semiconductors. From $33billlion (£24.9 billion) in 1987, the value of the total world market for these is forecast to have grown to 10 times that size in the ensuing 30 years.

Semiconductors and computer chips are at the heart of most of the devices we use today – yet in its character and scale this industry is light years away from those which we once considered to be the main drivers of our economy.

The main differences between this industry and older ones on which Britain’s manufacturing capability was founded are:

• It is more highly skilled: Its workforce has faced up to the challenge of producing far more complex items, which has meant it has needed workers with more specialised knowledge;
• It produces far higher-value goods: Today’s manufacturing workforce in the UK is concentrated in sectors which produce more highly-specialised, higher-value goods, such as the semiconductors mentioned earlier, but also vehicles and accessories, and other components for computers and connected devices;
• It doesn’t involve most of its workers getting their hands dirty: It might only be a small detail, but this is one of the most significant. Working in a steel mill, or down a coal mine, were notoriously grimy jobs. Today’s factory floor is more likely to be staffed by people in neat overalls, or even white coats, rather than boiler suits.
• Working hours are more widely controlled: While it remains to be seen whether there will be any changes resulting from Brexit, at the time of writing, the UK still has controls over a worker’s maximum number of working hours. However, such regulations only came into force in 1988, and up to this time, the number of hours each employee worked was a result of either direct negotiations between employer and employee, or their trade union.
• The UK’s workers are generally more productive than those in our biggest competitors: Official figures show that the price of goods produced in the UK per hour worked is the lowest of all the G7 countries except China. So this shows the scale of our emphasis on higher-value, specialised products.
• Technology and automation are at the heart of everything we make: While there are many successful companies still making humble, basic industrial components such as screws and washers, the UK has fully embraced what’s sometimes called ‘the fourth industrial revolution’ – which its proponents say will take the advances produced by mass digitisation of the systems and information we all now use and need, and take them in new, as yet unanticipated, directions. Finally;
• We are living in a global economy: Exporting has always been an important element of the UK’s achievements and standing in the world. But while at the time of writing, there is much discussion over how our relationship with the rest of the European Union will change as a consequence of Brexit, it has never been easier for anyone to share and distribute data, information, and physical goods, around the world. The growth of transport and logistics networks has happened as a necessary consequence of this greater need for the ability to get goods to anywhere in the world – and in turn, it has become a new industrial sector in its own right.

Salt Of The Earth

Here in Cheshire, of course, we still have the remnants of one of the longest-surviving large-scale industries anywhere in the UK – salt mining and processing.

Salt has been mined in the areas around Northwich, Middlewich and Nantwich since Roman times, and while it continues to this day, the uses to which the raw product is put have changed massively.

Improved techniques have also greatly increased the amount of time a salt production plant can spend in operation between ‘boil out’ periods – that is, the times which are spent out of use for deep cleaning of the salt from all moving parts so as to avoid corrosion.

While salt mining and processing is one of the few industries which has remained at the heart of Cheshire’s economy throughout its history, it has fared somewhat better than other traditional industries – and is well-placed to stay as a major feature of our landscape for many years to come.

But our industrial landscape has also changed, in line with the advances outlined earlier in this article. And as our future prosperity depends heavily on our continued ability to lead in both old and new industries, how well we adapt to these changes, and others which no-one can yet foresee, will be key to our future prospects.
What have been the most striking – and important – changes in the industrial landscape you have witnessed in your lifetime, and why? We’d love to hear your thoughts. Let us know on our Facebook page.

It’s a hot topic just now – as the country starts to take in the ramifications of the decisive vote on 23 June, when the electorate decided by 55% to 45% that Britain’s future lay outside the European Union, every part of the economy is digesting the news, and trying to make sense of what it means for their future plans and direction.

No decision taken by voters in half a century is expected to have such a wide impact on the country’s future – and even though the outcome was decisive, disentangling ties and trading arrangements built up over that time is sure to be a protracted process, and one which is sure to bring to the surface tensions and differences which a mere half-century make seem like a temporary spat.

So before the talks get under way in earnest, now is the time for sober reflection, and possibly considered thought over what a world outside the EU might look like.

The Rollercoaster Takes A Dip

But there are reasons to think that the early signs of prospects for manufacturing and engineering in the UK aren’t good. A report at the end of July from the Engineering Employers’ Federation found that members’ confidence had dipped in all parts of the UK since the EU referendum result had been announced.

The Federation’s annual report uses data gathered from members, along with the government’s Office for National Statistics to draw a picture of the levels of confidence among manufacturers. It came to the unequivocal conclusion that “manufacturers’ business confidence has taken an across the board beating”, with every English and Welsh region registering a downturn in optimism.

Measuring participants’ confidence as a score out of 10, the EEF found that it had dropped from 6.37 pre-referendum to 5.24 in the weeks which followed.

In the north-west, the degree to which many manufacturers depend on continuing support from an overseas parent business was laid bare, with more than a quarter (28 per cent) expressing fears over whether they might continue to be treated fairly. More generally, nearly six out to 10 firms in this region identified their biggest concern as possible weaker demand for their products.

Worryingly, a quarter of manufacturers in the north-west of England claimed they couldn’t see any new opportunities arising for them as a result of Brexit.

When it comes to what manufacturers want to see in order that confidence can be built,  a solid business environment, supportive policies and the right outcome from Brexit negotiations should get sentiment back on track.

While recognising the scale of the negative sentiment in the sector in general, Lee Hopley, Chief Economist at the EEF, nevertheless reiterated that engineering firms have experienced all kinds of economic conditions, and have often succeeded by facing such challenges head-on.

“The referendum outcome has provided a jolt and it’s clear that there are fresh challenges ahead,” she said.

Time For ‘UK plc’ To Show Its Mettle

“Exchange rate volatility, political uncertainty and the danger of increased costs are already causing concern across the regions and business confidence is in short supply. But our sector is nothing if not dynamic, determined and resilient. UK manufacturing remains a force to be reckoned with.”

She stressed, however, that “a solid business environment, supportive policies and the right outcome from Brexit negotiations allowing for trade and ongoing access to skilled workers” were now essential for ensuring that the sector could defy the doom-mongers and find a clear path forward.

Tom Lawton, partner and head of manufacturing at accountancy firm BDO – which co-compiles the EEF’s report – added that many businesses had had time to adapt to the likely outcome ahead of the vote, and said its outcome “should not detract from the fact that UK manufacturing performance over the last 12 months has been strong with six (out of ten) regions seeing an increase in output.”

He said many businesses would be heartened by the promise from Prime Minister Theresa May of “a proper industrial strategy”, and challenged her by adding: “We would like to see the Government match manufacturers’ long-term outlook by developing a 15-20 year industrial policy that avoids the disruptions of the political cycle.”

Weaker Pound To Come To The Rescue?

Industry editor for the Telegraph, Alan Tovey, noting that the manufacturing sector still  represents 10 per cent of the UK’s £1.8 trillion GDP, added that the depreciation of sterling against other currencies since the ‘leave’ vote should, in the short term at least, provide a boost, because it “makes exports cheaper, with buying British becoming more attractive to foreign purchasers who suddenly find their currency goes a lot further.”

At the same time, he added, it should also mean “a short-term boost to Britain’s internal market, with manufacturers more likely to source components for their products domestically as buying abroad becomes more expensive.”

Sales among UK manufacturing companies are split roughly equally among Europe, the United States and the rest of the world, pointed out Jo Reedman, senior capital goods analyst at N+1 Singer. As a result, she agreed that the weaker pound should bolster efforts to remain competitive and sell products well beyond the boundaries of the EU.

Mixed Messages For The Motor Industry

With the UK’s motor industry boasting very strong international – not just European – links, Prof David Bailey, an analyst of the sector from Aston University, Birmingham, said Brexit would be a double-edged sword. While it will make exports more competitive, and so possibly boost sales, with consequent increases in production to meet demand, “it will also increase the cost of importing components, and about 60pc of the components that go into UK assembled cars are imported.”

Given that, under the Lisbon Treaty, the negotiations which will eventually lead to the UK breaking its formal ties with the rest of the EU could take up to two years – and that includes provisions for negotiating alternative trade agreements – it’s expected that many firms will continue with ‘business as usual’ for the immediate future, and there should be no reasons why this approach won’t bear fruit.

But, as Capita Translating – a business which has a vested interest in see the UK continue to trade with as many nations around the world as possible – points out: “The bad news is that trade deals take an excruciatingly long time to negotiate – in 2009 the EU ended a 15-year dispute with Latin American countries over importing bananas! But, being such a big trade partner to the EU means they are more likely to want to agree a deal quicker.”

So, for now, there are no reasons why prospects for manufacturing in the UK should be downgraded. And indeed, right now, with a low pound, and existing trading agreements still running their course, it’s a good time to be looking to spread the ‘Made in the UK’ message anywhere around the world.

Engineering The Future: Exploring The Lack Of Women In The Industry

Great engineers have never been in such short supply. Here in the UK, projected figures suggest that, as a nation, we’ll need to recruit 2 million new engineers during the next decade.

Nobody can contest the demand for high quality professionals to enter into the industry, however the issue of recruitment remains one of the largest threats to great British engineering. This problem is further exacerbated by the extreme lack of females entering into the sector.

Statistics show that 94% of the engineering workforce are male. As an industry, it’s crucial that we address this balance. Not only in order to meet the demand for jobs, but also to remain able to provide the very best solutions for clients. Both sexes bring different capabilities and vision to the table. By balancing the workforce we position ourselves to successfully solve the problems of the future and cater successfully to client requirements.

To counter the problem, we must first understand its multifaceted nature. Is it that women are reluctant to join the engineering world? Or could the problem be that a notoriously male dominated industry is intimidating for female recruits?

Education Matters

We have to consider the fact that, as a country, we perhaps deskill our female engineers from childhood. How many of our young girls are given toys such as Lego, Mechano, cars and building materials to play with? Compare this to the toy box of a boy. Boys are given what society regards as male toys.

These toys are known to help develop spatial intelligence and problem solving capabilities, therefore, the types of skills required to become an excellent future engineer. Meanwhile, our girls, their future chances already being affected by their gender, are developing their nurturing and social skills by traditionally playing with dolls and skipping ropes.

This message is, sadly, reinforced throughout educational establishments. Girls, having been deskilled during their early education, excel in the arts and humanities subjects at secondary level. They outshine the boys academically in both science and maths, mature more quickly and are much more likely to follow the rules.

Meanwhile, the boys are building strong social networks through sporting endeavours and their often boisterous, explorative behaviour is attributed to “boys being boys” whereas this behaviour would result in reprimand for their female counterparts. All the while the boys are developing those vital, on the job skills that great engineers require, whilst the girls are busy getting the grades on paper.

Could it be that their academic success is resulting in girls being recommended to take the more traditional, academically accepted, employment routes? Is a career advisor likely to suggest engineering to female students? As a nation, we must address the imbalances within our education system to truly level the playing field for both sexes in the future.

Furthermore, the profile of engineering must first be raised within our educational establishments and its dirty, manly facade, must but be eroded as inaccurate. Careers advisors and young people themselves, should be armed with the facts about the diverse and exciting nature of working within the sector.

Gearing Towards The Future

We must aim to recruit across a representative cross-section of society in order that we remain current and able to problem solve effectively; focussing on providing world leading solutions. Once recruited, we need to ensure that there are successful, supportive female mentors and role models, working in industry, to support the new wave of female engineers.

To that point, our parent company Cygnet Group has been taking the lead in the push for new female apprentices in the Engineering industry. Just recently, Cygnet Texkimp took on two new apprentice females, as apart of their excellent Apprenticeship Academy. We wish them all the best in their roles and offer our support to fruitful, thriving career in the sector.

By remaining in the male dominated past and continuing to alienate 50% of available recruits, the UK engineering sector risks its future. Engineering companies must launch a PR offensive in the coming years, in order to ensure that, when considering their future career options, engineering is an attractive option for young people with the appropriate skills, regardless of gender.