Manufacturing Sector

Mark Prisk Excerpts

Wednesday 18th May 2011 Westminster Hall

[The Minister of State, Department for Business, Innovation and Skills (Mr Mark Prisk)]

May I also congratulate the hon. Member for Wirral South (Alison McGovern) on securing the debate on this important subject? I gather that this is her first debate in Westminster Hall. It is about an excellent subject.

The hon. Lady pointed out that in her constituency, as in others, modern manufacturing is crucial. She mentioned Unilever. We have learned about the role of GM Vauxhall at Ellesmere Port and that of Airbus nearby. All are at the cutting edge in their own fields. They are all businesses of which we should be proud and I know that they are directly important to her constituents. She is right to say that manufacturing should be a non-partisan issue. I share fully her desire to ensure that manufacturing is at the heart of Government policy. We are determined to ensure that we establish a more resilient economy so that when we face, as we will, different shocks and challenges, we have a broader economy. Manufacturing plays a vital role in that.

I would like to put on the record my own encouragement and support—my private office will regret this, no doubt—for the associate parliamentary manufacturing group, which is very important. It is absolutely right that hon. Members across the House should feel that they can play a part in promoting this vital part of our economy, and I happily commend the group’s work.

As the hon. Lady said, some would have us believe that we are not in the business of making things. They are wrong. In fact, this country remains one of the world’s leading manufacturing nations. Manufacturing generates approximately £140 billion of our economy—some 11% of gross value added. On exports, to which she rightly referred, manufacturing represents 55% of everything that we export to the rest of the world. Encouragingly, in the past year we have seen an increase in that programme—approximately 19% on a year-on-year basis. That is good news.

Let me turn to the specific points that the hon. Lady raised about the profile and status of manufacturing. In a sense, that is a broader and longer question. There are two issues. The first is to tackle head-on the outdated perceptions of what modern industry means. The second is how we equip people, so that industry gets the calibre and range of people that it needs.

Changing those negative perceptions—the hon. Lady is right about the media—will be a challenge; some of them are deeply embedded. For example, in 2009, the number of graduates in science, technology, engineering and maths actually represented 43% of those leaving our universities. Only 5%, however, go on into industry. Clearly many young people who have the potential skills that industry needs are going elsewhere. They have not seen industry as something for them. That is the mindset that we have to change. We have to show young people what is the case, rather than what they might think—to fire up their imaginations and ensure that they can see that there are genuinely rewarding careers in industry.

I would like to highlight the work of the Manufacturing Institute, to which the hon. Lady referred. I would be more than pleased to meet its representatives and the hon. Lady. They have already met officials in my Department, and I strongly commend their organisation’s work. I suspect that some of that work coloured my own views on what we needed to do when I was asked to take on this role a year ago. When I started, I wanted to showcase, in the large reception area in the Department, what we make. We have already been able to show a wide range of products, through a series of exhibitions.

The hon. Lady referred to the composite wings. After some challenges, not least having to take the door down, we installed one of the composite wings into the reception area to demonstrate what we make. We also exhibited the first zero-carbon motorbike made in this country. There are many other products that we want to exhibit and we are building up that programme so that people across business, and the wider public, can see what we do.

We want to go further. We have announced open days across industry so that factories, and those who work in them, can show their neighbourhood what they make. Rather than telling people, it is often wiser to show them; that is the heart of this argument. That will change perceptions. GM Vauxhall and Jaguar Land Rover are among the many automotive businesses who have signed up to this, which we are calling, “See Inside Manufacturing”. We will roll that out now over the whole manufacturing sector so that we can engage people and show those who have never stepped into a modern factory what it is really like.

We want to ensure that we tackle the myth about low salaries. As the Manufacturing Institute points out, there is a misconception. According to the Office of National Statistics, the median salary for professional engineers is just more than £36,000 a year, which is in the top 30% of UK salaries. As people’s careers develop, that rises to a median level of £55,000 for a skilled engineer, which is in the top 10%. Most people do not realise that, and that is the mindset that we are working with industry to change.

I am aware of the time, so I will just touch on the issue of skills and then move on to the issue of exports. The issue of skills is crucial. If we fire up the enthusiasm of the next generation of engineers, we need to ensure that they are equipped to do the job. We have focused on university technical colleges, so that we can deal with the vocational desire that many young people have while still at school age—14 and onwards. They will be able to get their hands dirty and do practical things that they can learn from. That is what UTCs are all about.

That needs to be harnessed by going further, so we are expanding massively the whole apprenticeship programme. There are excellent examples—I am aware of the one in Wirral, the Wirral Apprenticeship Scheme, which local businesses take up. We are looking to put £180 million, from the last Budget, on top of what we have planned for, so there will be approximately 250,000 additional places in the next four years. That will take the perception of young people through to equipping them with the skills that can benefit industry, too. We need to deliver on that through-thinking.

In the few moments I have left, I will touch on exports and the supply chain issue. The five-year plan set out by UKTI is crucial. The hon. Lady is right; if it were to be run from London without any genuine local roots, whether in Merseyside, Manchester or the midlands, it would fail in its task. We have made sure that UKTI is working with local enterprise partnerships across England, as well as our good friends in Wales, Scotland and Northern Ireland, so that they have a strong national voice abroad, but deep local roots in terms of local knowledge and information. In particular, that means that the international trade directors, who are the local keys to this, are already developing strong working relationships with local enterprise partnerships.

The hon. Lady mentioned the supply chain, which is very important. The automotive sector is crucial. In the past 12 months, I have pushed the industry and worked with it. We have now developed a road map. The industry has identified £1 billion-worth of goods that it currently imports to use in the vehicles that it assembles, and which it would be happy to procure in this country. That is a good example of how we can develop, and I want to build on it if I can.

In conclusion, I endorse totally the points raised by the hon. Lady. We need to ensure that people understand modern manufacturing and recognise it as a rewarding career. That is why we have been showcasing leading products and producers, promoting the benefits of STEM subjects, and working with industry to show that there are good and valuable careers. There is a lot more to do in this field, but this is a welcome debate and I hope that hon. Members on both sides of the House, across the political parties, can work together—not just in Parliament, but with the rest of industry as well.