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29 March 2017updated 09 Sep 2021 3:38pm

How the 4IR will turbo charge a national manufacturing renaissance

Digitalisation must theme future Industrial Strategy and end the UK’s over-reliance on the service sector, writes Alan Mak MP. 

By Alan Mak MP

By 1850 the Industrial Revolution had transformed Manchester from a city of 22,000 at the turn of the preceding century into a booming metropolis of more than a million people. Explosive growth fuelled by textile production led historians to dub Manchester a “cottonopolis” and “the first and greatest industrial city in the world”.

Population growth brought fresh ideas and new inventions. While the Spinning Jenny is perhaps the most well-known, it was Manchester’s pro-innovation culture and manufacturing strength that would spread and shape Britain’s economy in the decades ahead. What became known as “Manchesterism”, a form of Liberalism which opposed the Corn Laws’ high-tariffs and promoted free trade, inspired the likes of Adam Smith and Richard Cobden. 

Today’s manufacturers and exporters rely on “Manchester School” thinking as they innovate, embrace new technology, and ship goods around an increasingly globalised world. Breakthroughs in emerging technologies happen at an electrifying rate, from Google’s driverless cars and Amazon’s delivery drones to thinking computers, internet-connected household devices and 3D printers. The UK already has a strong science and innovation base, with British companies leading the way in ground-breaking fields like artificial intelligence (AI), robotics and materials science.

These new products are already redefining our lives, but if we want them to catalyse economic growth and accelerate our manufacturing renaissance, we must take a pro-active, pro-innovation approach to mastering the Fourth Industrial Revolution (4IR), as this new wave of transformative technology is now dubbed.

The government’s Industrial Strategy Green Paper issues a clear call to businesses to step up and help shape the future with new ideas, partnerships and investment. Business Secretary Greg Clark sees the new Industrial Strategy as a way to “build on the UK’s strengths and extend excellence into the future” and “ensure we are one of the most competitive places in the world to start and grow a business”.

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To really take advantage of this new, Fourth Industrial Revolution, we need to rebalance Britain’s economy away from our over-reliance on under-threat service sector jobs, towards highly skilled technology, manufacturing and engineering roles. The 4IR is already blurring the lines between the manufacturing and service sectors as networked products, also known as the Internet of Things, make life easier for consumers. Soon AI will be able to take on previously white collar tasks as well, such as diagnosing health problems or offering legal advice.

This will vastly improve efficiency, cut costs, and radically redefine the contours of the UK economy. In Britain’s future economy, every sector will be a tech sector, and the implications of this data-driven and heavily automated economic model are enormous.

Additive manufacturing will give consumers the power to order bespoke products and decentralise super-factories away from emerging economies with cheap labour. The Internet of Things will give businesses access to real time data on products and services, giving the most innovative companies a significant competitive edge. Cambridge University estimate that firms with a data-driven business model have 5-6 per cent higher output and productivity than similar organisations that do not.

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The government’s Industrial Digitalisation Review will bring together business leaders and academics to see how the “design, development and deployment of digital technologies can drive increased national productivity”. The Review’s conclusions will be a blueprint for a new Sector Deal for manufacturing and industry, outlining how the public and private sectors can work together to boost the take-up of new technologies in the UK.

“It is not yet too late for the UK to take the global lead in this space, but we are in danger of falling behind if we do not take up the challenge now,” says Juergen Maier, the Review’s Chairman and CEO of Siemens UK.

To improve public-private collaboration, I’m calling for a new National Institute for Robotics and Artificial Intelligence to be created. This innovation cluster would be the centre of the UK’s AI ecosystem, combining a national leadership council to facilitate engagement between government and industry on issues of regulation and policy, with a Catapult Centre-style hub for late-stage R&D and commercialised research.

It would replicate the success of Sheffield’s Advanced Manufacturing Research Centre (AMRC) which enticed Boeing to locate its new plant in the city to build high-tech components for the aviation firm’s Next-Generation 737, 737 MAX and 777 aircraft. Dyson are also backing UK manufacturing, with a £2.5 billion investment to support the development of new battery technologies and robotics at its new campus in Wiltshire. Sir James Dyson described the UK as “one of the best places in the world for R&D” but lamented the “continued shortage of engineers”.

The Chancellor has acted swiftly to address this head-on, using his Spring Budget to ensure Britain has the technical skills to capitalise on the 4IR. “I am determined to ensure that Britain leads and benefits from [the 4IR], as we did from the first industrial revolution,” he wrote ahead of his speech.

His Budget included new investment of £500million-a-year for technical education, increasing the amount of training for 16-19-year-olds by 50 per cent to 900 hours-a-year. More than 13,000 existing technical qualifications will be simplified into 15 ‘T-levels’ linked to the needs of employers, helping to build genuine parity of esteem between academic and technical education, backing the UK manufacturing sector, and bolstering the nation’s productivity.

These reforms – the most ambitious since A-Levels were launched 70 years ago – complement the government’s work since 2010 to upskill Britain’s workforce. Demand for these highly skilled technical roles will continue to grow, with 3D printing, automation and robotics set to catalyse a relocation of manufacturing and production back to the UK as the cheap labour advantages of emerging markets are eroded. This has already begun: hydraulics manufacturers Eaton, based in my Havant constituency, say the use of new automated machinery has resulted in some production being switched from China to the UK, bringing back jobs for local people and greater productivity for the business.

The 4IR is a once-in-a-generation opportunity to rebalance our economy away from an over-reliance on the service sector and towards high-value manufacturing; correct the regional disparities in investment, skills, and employment; and pivot from our historic position as a net importer as we sell our manufactured goods around the world. Let’s harness the spirit of modern day Manchesterism and use Brexit as a springboard to open up new, global markets for our manufactured goods – everything from British-designed 3D printers to UK-manufactured driverless cars.

With the right combination of political will, business leadership, and a renewed focus on free markets and innovation, Britain can lead the Fourth Industrial Revolution around the world and turbo charge our manufacturing renaissance here at home.