05 May RESHORING UK – an Opportunity for UK Manufacturing
The need to strengthen and simplify UK engineering supply chains by reshoring aspects of production has been a major topic of industry debate for decades – arguably.
Ever since manufacturers began outsourcing production to more competitively priced overseas economies there has been tendency towards a race to the bottom, based solely on price. However, there is an intrinsic value attached to making things here in the UK, not least being the opportunities to innovate. The ReshoringUK website at www.Reshoring.uk. highlights the skills and resources of the UK supply chains and aids manufacturers when considering domestic production for new projects or for the relocation ‘onshore’ of existing work programmes.
With the COVID-19 pandemic exposing the frailties of many of the UK supply chains, underlining in stark detail just how reliant many have become on the overseas supply of critical items, there should be more impetus put on re-establishing UK production of these parts and protect SME manufacturing.
Twenty-two leading industrial engineering associations are behind the growing Reshoring UK initiative which has been developed to assist manufacturers locate and understand the breadth of skills vested in the SME engineering companies capable of delivering UK-based products and services.
Everyone behind the Reshoring UK platform appreciates the complexities involved when transferring manufacturing from overseas. The website portal has been created to help re-establish the capability required to meet manufacturers demands and those businesses that have used it in this current crisis have realised just how much capability and competence is available within the UK.
It is clearly a myth that the UK no longer manufactures anything, but it is often repeated and needs to be dispelled. In reality, prior to this pandemic we were the ninth largest manufacturing nation in the world contributing 10% of the UK Gross Value Added (GVA). The sector plays a vital role as an employer, with a workforce of around 2.7 million, and as an innovator, accounting for 70% of all business Research and Development (R&D) spend.
Even before the global threat from COVID-19 there was a paradigm shift from OEMs looking at the benefits of reshoring, as highlighted by the Lloyds Bank report ‘Business in Britain: Manufacturing’. A sponsor of the Reshoring UK facility, Lloyds Bank undertook research which showed that more than a third (37%) of firms asked said they were planning to move manufacturing processes back to the UK that had previously been offshored to territories like Asia and eastern Europe.
The prime motive for this, cited by 71% of those with these plans, was to improve quality – a telling endorsement of the high standards that British manufacturers and workers uphold, which also has extremely positive implications for UK supply chains.
Julia Moore, CEO of GTMA who has led the initiative said, ‘With so much value to be gained for both sides, large manufacturers need only to look more closely at what is already available to them in this country, in terms of innovation, technology transfer across sectors, and quality. www.reshoring.uk urges the manufacturing sector to seize this opportunity to increase their UK supply chain.”
Pam Murrell CEO of the Cast Metals Federation, who were one of the first trade associations to support www.reshoring.uk agreed saying, “I would like to believe that there are some significant opportunities for more local sourcing and an increase in the amount of manufacturing carried out here in the UK. We have seen the challenges that long supply chains can cause and how easily they can be fractured. At the same time, we have a manufacturing supply chain in the UK that is dominated by SMEs who battle on against sometimes impossible odds. The UK rightly insists upon good H&S conditions for workers, as well as encouraging a focus on resource and energy efficiency, so just continuing to export our carbon footprint is not ethical. It looks like we shall need lots of new jobs to support the UK economy in the short and medium term – the wider value to the UK economy offered by the skilled and high value jobs in manufacturing, in terms of skills, local taxes and apprenticeships, should be factored in, certainly to any national procurement and infrastructure projects, with fiscal stimuli aimed at supporting investment and improving productivity.”