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Analysis released today (29 July) by manufacturing trade organisation Make UK found that UK manufacturing output was worth $259bn in 2022, the latest year that data is available for. That placed the country twelfth in worldwide rankings, the first time since 2012 that it is out of the top 10.
The fall down the rankings came as Mexico climbed to seventh on the back of an already strong manufacturing base, and Chinese investments made during the Trump presidency to counter tariffs. Russia also climbed to eighth on the back of substantially increased defence production, while Taiwan came ahead of the UK thanks to its global dominance of semiconductor manufacturing, where demand has risen substantially in recent years.
The data reinforces the need for the UK to adopt a long-term industrial strategy, Make UK said, as the top countries have strategies in place and see clear benefits to economic output. Last year, the organisation published a report that found that eight in 10 manufacturers feel they are at a competitive disadvantage compared to other nations with industrial strategies.
“This is a major body blow to UK manufacturing,” said Dr Graham Hoare OBE, chief executive officer at the Manufacturing Technology Centre in Coventry.
“We are home to some of the most innovative manufacturers and research facilities in the world. We must do everything possible to harness this expertise to reinvent ourselves as a manufacturing superpower.
“The government’s plans to change UK manufacturing’s fortunes through a new industrial strategy and key investments from the National Wealth Fund can’t come soon enough. But, as part of this, a major upskilling and reskilling programme will be critical. Without the right people with the right skills, we won't be able to hit productivity targets, even with the latest ideas, technology and funding in place.”
Harnessing the power of the energy transition needs to be a key part of the forthcoming industrial strategy, said Kelly Becker, president of UK and Ireland at automation and energy management company Schneider Electric. “The UK has huge potential to regain its position as a manufacturing superpower, if it harnesses the transformative power of the energy transition,” she said.
“This needs to be a key part of the forthcoming industrial strategy, which should assess and support the manufacturing and uptake of solutions that contribute to the decarbonisation and digital transformation of the UK economy and infrastructure.
“Many of these manufacturers are creating new, highly skilled jobs across the country and will help to supercharge local economies and maximise the UK’s competitive advantage globally, by developing local expertise and creating new trade and investment opportunities.”
She added: “Long-term investment in the manufacturing industry, such as maintaining and expanding full expensing, will be critical to driving growth and prosperity, help the UK reach net zero, and set the standard for climate and sustainability standards globally.”
The UK’s fall out of the top 10 is “deeply disappointing”, said Verity Davidge, director of policy at Make UK. “However, this isn’t a reflection of any decline in UK industry but specific factors and trends which are redrawing the contours of the global economy.
“These trends reinforce the need for the UK to react with a long-term industrial strategy to take competitive advantage of our undoubted strengths. This will ensure the UK retains its place at the top table of advanced manufacturing where it has many world class sectors.”
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