Letter: Need for a stronger manufacturing sector in the UK

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Sir: Hamish McRae is wrong to say that a concern about weak manufacturing competitiveness is a shoddy consensus ('Manufacturing, who needs it anyway?', 18 November).

Nor is it special pleading to say that manufacturing matters. The TUC represents workers across all parts of the economy and it is not just our industrial membership that is concerned about the decline of manufacturing. Our latest report on manufacturing, Industries for People, arises from discussion among unions in all sectors of industries and services. The real reason that manufacturing matters is not that it is unique; all sectors of our economy create wealth and are in reality interdependent.

But there is a particular reason why a stronger manufacturing sector is important in the UK. We now have a persistent current account deficit, mainly because of the weak performance in manufacturing. One way or another, whether through deflationary policies, a weaker currency, or higher interest rates, this holds back the growth of the economy. Whatever Mr McRae says, there is no realistic alternative to make up the trade gap in manufacturing. Our share of world trade in services is falling even more quickly than in manufacturing, and the most rapid decline has been in the insurance sector of financial services, where it tends to be assumed that we are strong.

We have an appetite for consuming manufactured goods that exceeds our ability to produce them, and this is holding back the capacity of other sectors to create the jobs that are needed. And while it is easy to find parts of services where wages are high and employees are satisfied, there are also rather larger areas where low pay and poor conditions are the norm.

It is unproductive to argue about the merits of one part of the economy over another. But that should not blind us to the crucial importance of a stronger and larger manufacturing sector if we are going to remove the constraints on growth that are holding us back.

Yours faithfully,

JOHN MONKS

General Secretary

Trades Union Congress

London, WC1

18 November

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