Responding to the publication of ‘Jobs, Welfare and Austerity: How the destruction of industrial Britain casts a shadow over present day public finances by Christina Beatty and Steve Fothergill (Centre for Regional Economic and Social Research, Sheffield Hallam University), Simon Topman, CEO of ACME Whistles, Birmingham, said:
“This report describes how UK manufacturing employment has fallen from 8.9 million to just 2.9 million over the last fifty years and the consequent destruction of the economic base of many communities.
“The report advocates a genuine rebalancing of the economy in favour of industrial production and a revival of regional economic policy. The report also suggests that policy makers need to take a long-term perspective, look at the differences between places, and stop thinking in silos.
“The big shift away from industry as an employer and generator of wealth needs to be turned around and nowhere more so than in the West Midlands where manufacturers and associated enterprises account for 38% of the local economy.
“The report suggests the near permanent effect of deindustrialisation has been to raise incapacity claimant numbers, both among men and women, (accounting for £20-25bn or around half the budget deficit), completely undermining recruitment into new manufacturing jobs and eroding UK’s export base leaving us with a trade deficit with the rest of the world, in goods and services, at record peacetime levels.
“The report tells us that ‘Britain is living beyond its means.’ That consumption and living standards are being sustained not by incomes earned by trading with each other and the rest of the world but by ever-rising debt and the sale of UK assets – companies, property, government bonds – to foreign investors: that debt has become the driver of UK economic growth. The UK manufacturing sector has become so hollowed-out that even a substantial devaluation of sterling, such as occurred in the wake of the 2008 financial crisis and more recently in the wake of the Brexit vote, no longer provides sufficient stimulus to bring foreign trade back into balance.’
“The Treasury has misdiagnosed high welfare spending as the result of inadequate work incentives and has too often blamed individuals for their own predicament, whereas in fact a large part of the bill is rooted in job destruction extending back decades. This is a very sad state of affairs and needs to be addressed now.
“The report strongly advocates the return of regional industrial policy and we have a great opportunity with the election of a Metro Mayor in 2017 to do just that. To my mind there is only one possible candidate: the Conservatives are only interested in the foreign owned corporate lobby and the return the financial sector can make from the selling of our heritage. Labour seems to be against any form of enterprise and wants to take us back to the 1970s and conflict between Trade Unions and employers.
“Beverley Nielsen is the only candidate that has recognised the need for a strategy aimed at stimulating regional self-made success driven through a renaissance amongst our small and medium sized manufacturing businesses. Only by making things and exporting things across the world can we not only rebalance the economy but we can pay for improvements in our transport, education and broadband infrastructures.”