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UK manufacturing companies begin ‘reshoring’ the suppl...

UK manufacturing companies begin ‘reshoring’ the supply chain

29 November 2013

Made in Britain, a Unite strategy for manufacturing growth in the UKBy Tony Burke, Unite assistant general secretary
 
When Unite launched its new manufacturing strategy ‘Made In Britain’ recently one of the key issues raised by our members was the question of bringing back manufacturing work to the UK which had flooded out of the country in the 1990s, notably in sectors such as motor and aerospace components and machinery.
 
Unite has described the decision by many manufacturing companies to produce outside of the UK in so-called ‘low cost countries’ notably in central and eastern Europe and also in south Asia as “the herd mentality” – if one did it others followed.
 
Unite’s strategy document calls for the supply chain to be ‘re-shored’ and we are backing initiatives such as that launched by the Automotive Council to being components and the supply chain back to the UK.
 
A new report published by the Manufacturing Advisory Service vindicates Unite’s policy on ‘re-shoring’ as the tide begins to turn.
 
The strategy of placing high-volume work in low-cost countries was an easy option but the past year according to the latest MAS Barometer shows 15% of firms are reporting that that they have been, or are in the process of, bringing production back to the UK, with just 4% looking to place work outside of the UK.
 
The MAS report argues that previous arguments that it is cheaper to produce outside of the UK is no longer the case as wage increase in Eastern Europe and the Far East begin to kick in.
 
The report also sites quality as a key issue and complex work that has to be returned can take up to six weeks to reproduce and ship back to the UK. The report also says that two thirds of companies surveyed expect further expansion until April 2014, while over half of manufacturers are looking to invest in premises and machinery.
 
Stephen Barr, Head of MAS says: “There is a notable change in approach from five years ago when the Far East and Eastern Europe seemed to be the destination of choice.  We have a quarter of our regional manufacturers seriously considering re-shoring in the next year and this contrasts to only 7% who moved production offshore the last year.”
 
Unite’s manufacturing strategy document is also aimed at influencing government and Labour Party policy on manufacturing and developing an industrial strategy that will re-balance the UK economy and has already had a House Of Commons launch. It will be rolled out to Unite members, employers and MPs over the next few months and can be downloaded here.
 
Also work checking is the MAS campaign website ‘Manufacturing Matters'.