A BRUM DEAL FOR MANUFACTURING AND THE ECONOMY?

This week’s UK growth and manufacturing figures have been a reminder the pressures still facing the British economy. Add to that, a none too flattering report on BBC Radio 4’s Today programme on the state of manufacturing in Birmingham and you could be forgiven for thinking the dark days of the recession aren’t that far behind us. David Nicklin looks at the real story of economic growth here in the Midlands. Over recent months and years we’ve got used to hearing encouraging news about the improving health of UK industry and manufacturing. Steady growth compared our European counterparts and some big ticket announcements such as JLR’s recent £450 million investment in Castle Bromwich have all served to keep optimism buoyant. Yet there was somewhat of a reality check this week when the latest ONS growth figures showed Britain’s economic growth rate halved in the first quarter of the year from 0.6% to 0.3%, with construction output falling for the second consecutive month and manufacturing up a measly 0.1%. That was followed by further PMI numbers from Markit that showed manufacturing growth actually contracted in April. Around the same time, comments by John Humphreys of BBC Radio Four’s Today show caused a backlash after he said manufacturing was moving in wrong direction. Broadcasting from Digbeth, just around the corner from our headquarters Mr Humphreys said: "It was manufacturing that made this city great and if a place like Digbeth cannot reinvent itself like the city centre, then it couldn't half do with a bit of that.The problem is manufacturing in Britain is moving in the wrong direction.” Prominent local commentators were of course quick to debunk the notion, citing the region’s many success stories. We can only add our own voice to this. The bottom line is a raft of data and news points to the health of manufacturing and the wider economy in the Midlands. Indeed insolvency trade body R3 recently indicated the manufacturing and construction sectors in the area are second only to Yorkshire in outperforming their UK regional counterparts. Furthermore, manufacturing businesses across the West Midlands have been recognised for their contribution to British industry in the 2015 Queen’s Awards. As if that wasn’t enough, only yesterday, David Cameron was in Birmingham opening a new manufacturing facility and described the story of the economic growth and regeneration of the West Midlands over the last five years as being “really inspiring,” adding “what we have seen in the last five years is genuine industrial regeneration”. The growth story indeed mirrors our own experiences, having achieved circa 16% revenue growth on March last year and a 14% increase in employment, buoyed by greater demand from existing customers and new contract wins. That’s not to say there aren’t still challenges in the marketplace. The lingering question of whether Britain might leave the Euro, notwithstanding concerns over the wider health of the eurozone economy are both unsettling for manufacturers. Closer to home there are also concerns over what a fragile coalition government without a clear mandate could do to knock business confidence and we certainly need to do more to move our economy away from its reliance on the service sector. We may still be some way off the manufacturing output peak we enjoyed in the days before the big recession but Midlands manufacturing is very much here to stay and confident about the future. Rest assured, the 'march of the makers’ here in the Midlands is firmly on track, even if it slowed to something more like a trot in the first quarter of the year