Greater Manchester Manufacturing StrategyUpdate on Progress

Alison Gordon – New EconomyLEP 14th May 2014

LEP led Task and Finish Group

Remit• Identify sub-sectors where Greater Manchester is, or can

become, genuinely world-leading; • Respond to identified challenges and opportunities to best

support growth and business needs; and• Determine short, medium and longer-term priorities for

action.

Update on progress • Progress with evidence base and strategic consultation• Briefing on emerging findings

The Manufacturing sector is changing…

Advanced manufacturing

Food & drink manufacturing

Other manufacturing

0

200

400

600

1992 1995 1998 2001 2004 2007 2010 2013 2016 2019 2022

Em

plo

yme

nt (

Th

ou

san

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Forecast

Advanced manufacturing

Food & drink manufacturing

Other manufacturing

0

5,000

10,000

15,000

20,000

1992 1995 1998 2001 2004 2007 2010 2013 2016 2019 2022

GV

A (£

millio

n)

Forecast

Assembly is now less than half of manufacturing and related employment.

Digital convergence and new technology is driving increase in direct and related

service jobs

Manufacturing related service jobs now adds around 50% to core sector

employment

Fewer direct jobs.....

.. but rising economic output

27,900

18,600

15,400

12,500

9,200 8,6007,700

6,200

4,100

0

5,000

10,000

15,000

20,000

25,000

30,000

Em

plo

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t (in

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elf

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Manufacturing Employment

•Sector employs 98,000 people in Greater Manchester• Accounts for 91% of business R&D spend;• More GVA per employee than any other industry.

GM Sub Sector Strengths

Textiles Furniture ChemicalsFood and

Drink OtherEng.

Csltcy Materials ICT Machinery

Jobs 2.04 1.85 1.39 1.18 1.05 0.99 0.93 0.92 0.58Business 1.79 1.21 1.78 1.08 1.11 1.15 1.17 1.04 1.17

0.0

0.5

1.0

1.5

2.0

2.5

GM Key Supply Chains

Textiles Food & Drink

Chemicals Materials

Advanced Materials

Digital

Supply Chains (incl. Med tech – part of Aerospace..)

Strategic consultationAre our identified strengths correct?

Is our manufacturing base exploiting new technologies?

Reshoring opportunities other than textiles?

Level of productive collaboration to exploit new opportunities?

Does the manufacturing premises offer meet our needs?

What are the key skills issues?

Is manufacturing sector investing to the opportunities available?

How important is energy price? Are our manufacturers improving energy efficiency?

NW Business Leadership Team

Aerospace Alliance

Cogent

NW Manufacturing Forum

Manufacturing Advisory Service

Chemicals NW

MIDAS

Manufacturing Institute

Business Innovation and Skills

CBI

GM Chamber

Finding One

Leadership & Management is a significant sector issue

• Absence of vision• Reactive culture• Low adoption of new technologies• Low cross peer collaboration • Reluctance to invest• Leaders are low profile• Poor succession planning

Finding Two

Skills shortages & future workforce concerns

• Shortage of engineers• Poor image impacting on future career choices• Best engineers are going into finance• Low numbers of women in the sector• Ageing workforce• Concern about work readiness of apprentices

Finding Three Investment ready but low appetite

• Up to 70% of the sector may be debt free (NW Manufacturing Forum)• Confidence is increasing but sector is very risk averse• Investment reluctance more pronounced in family owned or MBOs• LEAN culture has led to financial prudence

Finding Four

Premises - Quality and availability concerns• Debt fears inhibiting investment in new premises• Issues raised about the quality of GM premises offer• Trend towards less industrial type premises – but there is limited availability• Multiple ownership barriers • Development industry response to demand is piecemeal

Finding FiveEnergy cost concern but resource efficiency

opportunities•

• There are UK Energy cost concerns• But energy efficiency opportunities are not being exploited• High speed digital become prerequisite

Finding Six Public Sector Investment

Fewer direct jobs..... but rising economic productivity

• Greater Manchester needs its companies to invest in new technologies and modern premises to grow this sector – but these will not necessarily create jobs

Leadership and Management Network

Management and Leadership Technological Enablement

Future Workforce

Resource Efficiency

Vision & ambition to

grow

Investment in R&D

Manufacturing Leadership Network

Chemicals MaterialsFood & DrinkTextiles

Advanced Materials

Primary Enablers

Digital

Focus Areas

Skills Development

Expanding into service and design markets

Improved Premises

Sector Investment

&Impact

Next Steps

1. Stakeholder Consultation with sector representatives completed

2. Consultation with industry on draft recommendations – May/June

3. Identify draft conclusions and recommendations – June

4. Draft Strategy to LEP July 2014

Next Steps