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Britain’s quality and heritage are our 'biggest selling points'

28 June 2011

UK high tech manufacturers regard the quality of British products and Britain’s strong manufacturing heritage as the most important selling points for the sector as it strives to be internationally competitive. The UK’s impressive R&D capabilities and good image abroad were also seen as strong supporting factors by the 403 high tech manufacturers questioned for a special survey on competitiveness by the GE High Tech Manufacturing Index.

However, they also felt the UK’s potential is still significantly hindered by burdensome business regulation, a shortage of skilled workers, the business tax regime and are keen for the government to further develop a specific government strategy for the sector.
Competition was most feared from the emerging BRIC¹ economies, with 50% saying they felt the UK was either a lot less (23%) or a little less (27%) competitive than these emerging markets.  80% said they felt that the UK was now just as or more than competitive as other major European economies.

‘Star sectors’ topped by aerospace and precision engineering

When asked to name UK high tech manufacturing’s ‘star sectors’, respondents put aerospace in the number 1 slot, following by pharmaceuticals; life sciences; chemicals and construction products, materials and systems.

When asked to name the specialist areas where they felt the UK could be considered a world leader, 75% said precision engineering was a major expertise area, followed by customisation (customer driven bespoke items), cited by 66% of respondents, followed by advanced materials (56%), support services (54%) and low carbon and environmental technologies (48%).

In terms of potential new ‘star sectors’ the development of renewable energy and green technologies were the most mentioned areas, with customisation and bespoke work, advanced materials, life sciences and nano-technology also frequently cited by the group.

Business regulation is hindering competitiveness
When asked what factors were helping and hindering the current competitiveness of UK high tech manufacturing, the top ‘help’ factors cited were quality of goods (+72 net help score) and the UK’s strong manufacturing heritage (+53) with the UK’s research and development capabilities (+31) and the UK’s general image and reputation (+22) also helping. 
Top ‘hinder’ factors cited were the burden of regulation on business (-55 net help score) followed by an absence of a specific government strategy (-51) and the availability of suitable skilled workers (–44).  Other issues mentioned were the lack of access to finance (-46), the UK business tax regime (-43) and the quality of the UK education system (-13 net help score). 

Can do attitude needed
However high tech manufacturers also felt the sector needed a more positive and ambitious outlook, allied to improved marketing.  56% agreed that a ‘lack of can do attitude’ was also holding the sector back, as well as ‘poor marketing’ cited by 52%.  45% agreed that there was sometimes ‘a lack of ambition in the markets the sector went after’.  53% also agreed that trade protection barriers in certain parts of the world were a barrier to expansion.

Two fifths (39%) of high tech manufacturers said they felt green tech was a large opportunity for their business, with over one in ten (11%) saying they felt it would be a massive opportunity.  66% felt it was also a large opportunity for UK manufacturing as a whole.

GE UK CEO Mark Elborne commented; “The UK needs to be more competitive in high tech manufacturing if we are to successfully rebalance the economy.  The research shows high tech manufacturers are keen to see the government develop specific strategies for the sector and we are very supportive of the government’s recent efforts to create a more cohesive plan of action.  Going forward one challenge will be to make sure these initiatives have good visibility in the sector.  I was also interested to see the plea for more optimism and ambition.  Sometimes we Brits are too self effacing. We need to get out there and sell our fantastic high tech wares”.

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