Margareta Pagano: The car industry is on a roll. But our skills are stuck in second gear
In The City: Apprenticeships should be made at least equal to university degrees
Margareta Pagano is a former business editor of the Independent on Sunday who now writes columns and business interviews for a range of publications, including the Independent, Independent on Sunday and London Evening Standard.
Sunday 14 July 2013
It was Françoise Sagan who said: "Money may not buy happiness, but I'd rather cry in a Jaguar than on a bus." The French writer had taste, but if she were alive today, she would choose Jaguar's new F-type model in which to sob her heart out as it's quite simply one of the most gorgeous racing cars on the road. Launched in May, sales of the F-type are zipping along at 1,000 a month, which helped Jaguar Land Rover's sales jump by nearly a third in the first half of the year.
The F-type, like all the 360,000 vehicles made by JLR last year, are made in Britain – every single nut and bolt. Since being taken over by the Indian Tata group, the company has grown rapidly and now employs 25,000 skilled workers – 7,000 of whom are engineers – and earns around £8bn in exports a year.
JLR's turnaround is one of the most astonishing success stories of the past decade but it's not the only one in the industry. Together with Nissan, Ford, McLaren, GKN and many others in the supply chain, JLR is part of an automotive industry that is now producing 1.58 million vehicles a year – nearly as many as in its 1960s heyday – and employs over a million people.
And do you know why the industry is so spectacularly successful? This is the pot-boiler. They may be in short supply but the UK still has the best engineers in the world, and meanwhile the carmakers enjoy great relations with their work-forces and work closely alongside the unions, such as Unite. That's not what we are used to hearing about British industry or its workforce, but it's true and we need to shout it out loud.
Now the auto industry is so confident about the future that it is co-investing with the Government to build a new Advanced Propulsion Centre to research and develop the next generation of engines – low-carbon ones to replace our petrol and diesel ones. Over the next decade, the Government and the 27 automotive companies that are collaborating will invest £500m each in the APC, which is likely to generate another 30,000 new jobs.
Huge credit for getting this new research centre off the ground should go to the chief petrol-heads, Vince Cable, the Business Secretary, and Professor Richard Parry-Jones, co-chairs of the UK Automotive Council, who fittingly announced the new deal at Goodwood's Festival of Speed on Friday.
Indeed, it is the result of a great partnership that has seen £6bn of foreign investment in the UK over the last two years, helping to secure at least 7,500 jobs. Mr Cable, who has also set up the Automotive Investment Organisation, reckons this amount can be doubled over the next few years.
This is what a modern industrial strategy looks like – imaginative, collaborative and long term. Yet there is more to be done in fleshing out the details. Unite, which welcomed the strategy, also makes the point that ways need to be found to build more on the UK's domestic supply chains, as too many components are still coming from overseas.
Of greater concern is whether there are enough young people with the right STEM skills (science, technology, engineering and maths) to fill the huge number of jobs that are on offer. The Automotive Council says its members hope to recruit around 7,600 apprentices and 1,700 graduates over the next five years. Sadly, the answer is that we don't have those skills in great enough quantities – we have only about half the engineers needed for jobs across all industries.
If the young are to be inspired we need a new national careers service, and apprenticeships should be made at least equal to university degrees.
It doesn't matter that foreigners own our car industry but it does matter that we make the cars here. Just imagine the horror if the success of the last decade fell apart because of a lack of skills. Now that would be embarrassing.
As I've said many times before, this skills shortage is down to too many parents and teachers still being oblivious to the huge potential within the manufacturing sector. So here's an idea: Jaguar Land Rover should give all head-teachers an F-Type to test drive for at least a term when school starts in September. Maybe that will get their juices flowing.
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