Mixed messages for manufacturing

Anyone who has followed the news lately could easily be forgiven for a degree of scepticism as regards this Government's commitment to manufacturing industry. It is, after all, difficult to take seriously assertions about 'rebalancing the economy' in the light of large-scale job losses at BAE Systems – one of this country's flagship manufacturing companies.

Of course, these job losses have been on the cards for BAE ever since the Strategic Defence and Security Review. Nonetheless, their scale came as a shock, as did their apparent impact on highly-skilled workers of exactly the sort whose cause this Government has championed so vocally.

Of course it is not the Government that has made these job cuts, it is BAE Systems. And, while the news may be in large part a consequence of Government spending cuts, they have also come about because of a worldwide trend towards lower defence spending. Equally, of course, the news is not all bad for the sector: according to the Reed Manufacturing Job Index, manufacturing jobs are up 4% month on month, and up 32% year on year, according to the national report for September, while the Government's commitment to spending £195m on cutting-edge science and engineering projects is clearly to be welcomed.

Nonetheless, the BAE job losses are emblematic of the fine line this Government is having to walk between its laudible desire to cut the UK's public spending deficit and its desire not to hinder growth in key sectors such as manufacturing. Nobody is pretending that this is anything other than a difficult balancing act, but it is to be hoped that the need to cut spending does not blind us to the need to foster growth.

Paul Fanning

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