Manufacturing moving back to UK

Recent reports show that a growing number of companies have started to relocate their manufacturing back to the UK. This surprising information has come from a report into the state of the UK manufacturing sector by the EEF and BDO, that found one in seven companies surveyed had moved production back during the last two years.

Commenting on the report in the The Times newspaper on Wednesday 30 December 2009, Industrial Correspondent Angela Jameson reviewed the findings. In addition to quality concerns, it was stated that increased freight, energy and commodity costs were significant contributing factors that undermine the financial advantages of producing goods overseas. It was also noted that the continued weakened value of the British Pound also helped make UK manufacturing a more cost effective proposition.

The global recession has forced many businesses to evaluate their value chains and production costs. Overseas manufacturing still remains attractive, but an increasing number of UK companies are concerned over the commercial viability and sustainability of lower cost supply chains. Evidence suggests that the trend of the past two years will not be sufficient to stimulate a growth in domestic employment. Until now the private sector has experienced the greatest pressure on cost down and headcount reduction, these pressures will becomes increasingly evident through the public sector this year. 2010 brings a continued focus on cost reduction across the UK economy, holding back employment recovery.

The return of manufacturing to the UK is a small but welcomed trend for the moment. Without goods being produced domestically, the continued decline of the surface finishing sector is inevitable. Let us hope that with a general election this year, who ever forms the next government will provide genuine support to industry and a policy agenda to stimulate a return to large scale manufacturing.

The Times newspaper article can be seen online at: http://business.timesonline.co.uk/tol/b … 971067.ece

Last edited by paulcw (01/04/2010 - 12:38 PM)