Manufacturing Competitiveness in Britain- From Decline to Renewal?

Abstract

In 1890, Britain was the largest and most powerful economy in the world. Now, a century later, it is not. Since 1960, other European countries such as Germany and France have not only caught up with Britain but overtaken her, as have other countries such as Japan. In particular, Britain has lost its status as a manufacturing economy. In the last 100 years or so, Britain’s share of world manufacturing output has fallen from 25 per cent or more to about 4 per cent; its share of world trade in manufactures, from about 40 to less than 9 per cent (Supple, 1994). Manufacturing output grew far more slowly in the United Kingdom in the 1970s and 1980s than in other large industrial economies. Since 1979 GDP has grown as much in the United Kingdom as in France and Germany but manufacturing has grown more slowly. The percentage of the British labour force employed in manufacturing, mining, construction, and public utilities began to decline in the early 1970s from its historic level since the middle of the nineteenth century of about 43 per cent, falling to 38% by 1981 and below 30 per cent by the end of the 1980s (Supple, 1994).

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