British engineering has had an illustrious past – from Newcomen, Watt and Savery's development of the steam engine in the early 18th century to Fleming's invention in 1904 of the vacuum diode, British engineering and ingenuity has formed the foundations for much of the modern world.
Of late, however, the going has been much tougher. British engineering is certainly not the force that it once was. After the second-world war, almost half the workers in Britain were employed by the engineering and manufacturing industries. Today less than 15% of the UK workforce makes a living from the sectors.
Engineering has developed a reputation in the media for being “dirty, greasy metal-bashing”, with information technology and the services sector being seen as the sexy places to be. Inventor, James Dyson gave a speech called “Engineering the Difference” in 2006 bemoaning the lack of interest in engineering amongst the young. "We produce 24,000 a year. Compare that with the 350,000 in China and the 450,000 in India… In 2005, the UK produced 77,000 media and social studies graduates”. [1]
The emergence of China and India as major manufacturing bases has inevitably lead to questions about the competitive strength or even viability of much of British engineering. On top of this, the sector, as with nearly all others, has suffered over the past 24 months dominated by the near collapse of many of the world’s biggest banks. The essential remedies for this, recapitalisation, deleveraging and a ‘back to basics’ approach to bank lending, inevitably resulted in a collapse in demand across is end-user markets.
Don’t believe the hype
While the long term trend of increased global competition is indisputable, there are a number of reasons to think that both the short and medium outlook for British manufacturing is not as dire as is widely believed. As Philip Whyte of the Times has noted, until the credit crunch hit global output, manufacturing output in the UK was higher than it had ever been. "In 2007 it was two and a half times higher in real terms than it was in 1950. And despite the surge in imports from China, production was 7.1% higher in 2007 than it was in 1995". [2]
After years of strong growth, increased fuel costs, material costs and wage inflation are causing Far East manufacturers to raise their prices and the…
