Proposals for Scottish manufacturing revealed

Posted on 18 Apr 2011 by The Manufacturer

Low tech manufacturing sectors must not be ignored and investment needs to step up if a rejuvenated manufacturing sector in Scotland is to lead the country’s economic recovery, the Scottish Trade Union Congress (STUC) has warned.

STUC’s new discussion paper – The Future of Manufacturing Industry in Scotland – has been published ahead of the organisation’s annual congress, starting today in Ayr, where manufacturing will be top of the agenda.

Though Scotland suffered as a result of the recession manufacturing there fared better than the rest of the UK, the paper points out. STUC says with the right infrastructure manufacturing can once again flourish north of the border. Manufacturing Gross Value Added in Scotland fell by11.44% during the recession, compared with 14.58% for all of the UK. The country suffered 37,000 manufacturing job losses over the course of recession, bringing its total to 176,000 by September 2010, or nine per cent of Scotland’s total workforce.

The paper makes a number of recommendations. It says low tech manufacturing sectors like food and drink and textiles shouldn’t be abandoned as they continue to employ far more people than high tech sectors; more revenues from Scittish R&D and innovation must be retained in the country; an industrial strategy is needed based on passive measures like tax breaks for R&D and effectively rationed grants; measures to increase the number of women in the industry and lessen gender pay disparity; and more apprenticeships and manufacturing MAs are required.

The paper also suggests a taskforce should be created to analyse the success Germany has found in its manufacturing sector and look at how Scotland can take inspiration.

What’s more, STUC argues that the Coalition has introduced “avoidable, unfair and regressive” spending cuts because of an unbalanced economy which government has been slow to address. Grahame Smith, STUC general secretary said the organisation itself has been touting a more prominent role for manufacturing and less for financial services since “Long before the great financial crisis of 2007-09.”

“Over the past year, the STUC has presented its priorities for manufacturing to the First Minister, the Scottish Parliament’s Economy Committee and the National Economic Forum,” said Mr Smith. “The STUC is now publishing the Future of Manufacturing in Scotland in order to help support a mature, evidence based discussion over the policies required at UK and Scottish level to nurture output and employment growth in our manufacturing industries.

“Politicians across the spectrum are now quite correctly focusing on how the economy might be rebalanced back towards manufacturing. It is essential that the opportunity provided by this emerging consensus is grasped. The STUC will urge the new Scottish Government to work with partners to develop a modern industrial strategy for Scotland and the paper we are publishing today highlights the key issues to be addressed. These include the provision of the patient and committed finance of which Scottish manufacturing firms have been starved. It is absolutely vital that finance is reformed in order that it supports, rather than undermines, the productive economy.

“The brazen tax cutting, deregulatory agenda being promoted at UK level doesn’t begin to build the long-term business culture necessary to sustain and grow manufacturing.

Scottish Labour leader Iain Gray said if his party is elected as the next government in Scotland, manufacturing will be “at the very heart” of its focus.

STUC represents the interests of Scotland’s 37 affiliated trade unions and 22 trade union councils with a collective membership of 640,000 workers.

The Future of Manufacturing Industry in Scotland report is available on STUC’s website.