How does manufacturing contribute to UK resilience?

In this blog the Energy Technology and Control experts evaluate how manufacturing contributes to UK resilience. The UK has a selection of unique characteristics that shape and contribute to its resiliency. Business resilience focuses on the important processes and procedures that help businesses endure unexpected threats.

What is resilience in a business context?

Resilience as a notion has gained credibility as the world has realised the significance of responding to an ever more diverse array of external shocks and transitions. These include financial crises, climate change, energy disruptions, technological shifts, terrorism, natural disasters and extreme weather events. The geographical vulnerabilities to risks are seen as amplified due to the increased interconnection and interdependence between locations in a global context.

What affects UK resilience?

The UK has a series of distinctive characteristics that contribute to its resilience. Firstly, the UK pioneered industrialisation. Being at the forefront of early manufacturing allowed the UK to drive economic growth and prosperity, becoming known as the ‘workshop of the world’ in the late 19th century.  This early learning provided a broad array of valuable knowledge and skills.

Using this as a springboard, the UK has gone on to establish specialisations in particular economic sectors – including aerospace, creative industries, financial services and pharmaceuticals – these specialisms tend to be in high value-added activities.

High value-added manufacturing refers to those companies that benefit from highly skilled, knowledge-intensive operations. These companies often compete on unique value and innovation, rather than price. The UK has a strong foothold as a global value-added provider.

Resilience and shocks

The history – and geography – of the UK does however also make it vulnerable to the transmission of external shocks, instabilities and disruptions from elsewhere. Recent experiences demonstrate this lack of resilience, for example, the financial sector’s exposure to the mortgage crisis in the US and the manufacturing sector’s exposure to recession, instability and the debt crisis in its major export markets in the Eurozone.

However the physical geography of the UK also shapes its resilience to challenges. Its proximity to trading has historically set the country in good stead, and more recently the understanding that the geography of the UK can have potential benefits, especially in terms of energy generation. Recent years have seen a number of offshore wind and tidal energy generation sites spring up to harness the physical geography of the UK.

UK manufacturing’s contribution to GDP

Manufacturing plays an incredibly important role in the training and skills development of the workforce; these highly transferable skills enhance the flexibility of the labour market in response to shocks.

The sectors which contribute most to the UK’s GDP are stated as services, manufacturing, construction, and tourism.

Does manufacturing contribute to UK resilience?

Manufacturing has significant value to the UK, both now and into the future. Continued learning can begin to contribute to the long-term task of constructing adaptive capacity in the UK; ensuring government policies across departments are resilient to future uncertainties.

Manufacturing is an integral element in the future resilience of the UK. Indeed, in the light of concerns about productive security, it is difficult to envisage how the UK will address future resilience challenges without a strong and vibrant manufacturing sector.

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