I've been sent this fascinating email by a relative of mine on the Isle of Wight who sent it to our national broadcaster and though I might be interested in a copy...

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There was a report on the BBC Business July 2010 http://www.bbc.co.uk/news/10557724 which produced the following graph:
Chart 1 demonstrates the decline in manufacturing as a share of economic output (GDP) from 1970 to 2000 using official data and then forecasts from 2009 to 2020.



Chart 2 using official data shows a similar pattern for employment from 1980 to 2009.



There is no mention of the Primary Wealth producers and their value to the GDP or percentage employed.



Now to my simple mind, (that of a retired Electronics Design Engineer who has spent the majority of his working life in manufacturing generating wealth and employment), we have only 2 sectors of the economy that generate wealth. They are:

1) the Primary wealth producers – those that harness the bounties of the earth such as Farming, Mining and Fishing, and

2) the Secondary wealth producers – Manufacturing who take the outputs of the Primary wealth producers and add value to it.


The other sectors of the economy are essentially the Service Industry, the retired, the un-employed and the sick, who can only exist if the Primary and Secondary wealth producers create sufficient wealth to employ them. (One could argue that some sectors of the Service Industry could be classified as “Wealth Protectors” such as Medical Industry, Armed forces and education.)

It is my experience that, within Manufacturing, for every Design Engineer there are approx 10 other employees (factory workers, admin staff, Management etc). Now there will be a supply side and a sales side (retailing) which are dependent upon the Design engineers doing their job properly. The factory workers also buy food, energy, clothes housing etc which keeps the shops etc employed.

I would like to know the true figure of people kept in employment by the UK’s Design Engineers, I would hazard a guess that it will be between 15 and 20 per Design Engineer. (by Design Engineer I include Chartered Engineers within Manufacturing including Software Engineers).

Now in Chart 2 above the % of Manufacturing jobs is approx 9%, therefore on my experience less than 1% of the UK workforce ( + those in the Primary Wealth producers) keep the rest of the nation employed.

The Financial Services cannot generate wealth on their own – they consume the wealth generated by the Wealth producers, yet they take the lions share! They are the tail that wags the dog! They can only exist on the profits generated by the Wealth producers. Those employed within the Financial Services get RICH, but they don’t create Wealth. Yet the Government do nothing to curb their excessive greed which has all but brought the Western world to its knees.

Why do we not have an indicator that measures the UK’s generated Wealth? Why is GDP used?

Why doesn’t the Government promote UK’s Manufacturing by offering a tax reduction to the workers within the Primary and Secondary Wealth producing industries?

Why don’t they offer further income tax reductions for those exporting UK generated goods the more you export, the more the tax break?

If this country is going to survive something drastic need to happen to get the UK creating wealth. We need to WORK, not cut back the economy.

We need to promote investment in UK Manufacturing. Why not have tax breaks on the dividends of new share issues only if the original investor keeps the new issues (i.e. not transferrable). This will encourage long term investments by the Pension funds.

Another BBC news report really caused me some concern http://www.bbc.co.uk/news/business-12172716 - We don’t have much time left!

Back in the mid 1960’s I had a Local Authority Grant and my College fees were paid for by my Local Authority. The costs of my education has been repaid many many times over by me creating exports and jobs throughout my working life, plus the extra income tax revenue as I earned more money than if I hadn’t studied at College. Just one problem I solved saved the NATO taxpayers some many millions of £s in current day values. So why does the Government increase the fees for those going to University to cripple them with £40,000 to £60,000 of debt?

Before I retired I asked some of the younger Engineers if they could manage if they had an extra £40,000 of debt to repay in addition to their Mortgages, You can guess their reply.

You could do this Nation a great service if you could explain economics to us all and provoke a useful debate on “How this country can get itself out of the current mess”.

Kind Regards

Martin *****
C Eng, MIET

Martin XXXXX is spot on. My background is similar to his, and I can fully appreciate what he is saying.

For too long engineers, that is real engineers, have been regarded as the problem and not the solution.

In my experience, even a third-rate secretary would consider herself, and be regarded, of more value than the engineer responsible for her future employment, and that of the whole company. At national and political levels the problem becomes a national catastrophe, as Martin XXXXX points out.

At this point in time there isn't anybody in the echelons of power that even begins to recognise what the the problem is, let alone begin to deal with it. If ever the truth of our desperate situation did begin to dawn on the minds of those in power, then it would probably take at least two to three generations to make any improvements.

The situation is desperate beyond measure and demands extreme measures to rectify it, such as only paying people according the actual value they add to the wealth production of the nation. At the present, non-wealth-producers take the largest rewards – such as politicians, bankers, TV newsreaders, crude and lewd celebrities, local authority chiefs, self-appointed experts on nonsense, sociologists, heads of NHS trusts, etc. etc.; whilst the back-room designers and developers of real wealth are regarded as expensive black-hand-gang parasites.

Always wondered what would happen when there were no growers or manufacturers left; the ` Service Industry ' workers will starve in the cold walking to work ?

GMR
C Eng MIMech E

I think to a degree manufacturers have thought of that with the built in obsolescence of what they produce, appliances are not as reliable as they once were, and a whole new sevice industry has been spawned from more breakdowns that occur, maybe the simplicity has been overtaken by more and more complexity, like washing machines no longer just wash, or food mixers just mix, home entertainment all singing all dancing, from CD, to VHF radio, multi channel TV, portable phones with teletext etc etc, great stuff for the young, but a lot to digest when you reach a certain age.

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Its not always the biggest and the bestest, its them that make the least mistakes.

The UK owes is place in the World to the likes of Brunel, Bazzeljet and other great Victorian engineers. They brought real innovation used today the World over.

The fact we can no longer match the excellence of the inventions they brought to market means slowly but surely we are slipping to third world status.

geezer466 wrote:
The UK owes is place in the World to the likes of Brunel, Bazzeljet and other great Victorian engineers. They brought real innovation used today the World over.
The fact we can no longer match the excellence of the inventions they brought to market means slowly but surely we are slipping to third world status
.........

I disagree with this, we can and do match the Victorian inventions. The last project I worked on was on a sub system for the Type 45 Destroyer. (the Sampson radar is 100% UK invention). There used to be an unclassified video on the web of the ASTER missle hitting an incoming missile. The RN website gives the velocity of ASTER 15 as 3600 kmph, and the ASTER 30 as 5040 kmph! This is staggering when you consider the speed and size of the incomming target.
British engineers, if allowed to, can knock the socks off any competitor nation.
Just look at how successful the British car industry is today now that it is owned by Japan, Germany and India. There is nothing wrong with the UK workforce.

We just need the skills of TOP management, and Governments to match the skills of British engineers.
For too long British manufacturers have designed products for the poorly paid UK population German industry designed products for the higher paid German public and exports.
You just have to compare the UK and German economies to see which system works best

Whilst I take your point defence exports are not that significant in the UK anymore. In any event the UK Government cannot sell this sort of technology to all and sundry.

http://en.wikipedia.org/wiki/Arms_industry The UK is the fifth largest arms exporter in the World behind Germany and France, this trade generated just over $1 Billion in 2010. Taken in context with the spending on the NHS which in financial year 2009 - 2010 was £51 Billion, these earnings are not very significant at all http://www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAndGuidance/DH_123459

The bottom line is our export earnings across all industries are falling or at best (and this is evident in defence) remaining static, at the same time public spending is increasing despite the austerity measures being put in place by this Government. Next week figures will reveal that we are back into negative growth so the Governments task of squaring the figure between export earnings, tax income and public spending is about to become ever more harder.

As for the skills of top management and Government, well the Government is appointed by the Prime Minister who is elected by all the people in the Country. If this person lacks talent then we are still stuck with him/her. The same applies in the public sector, top management are supposed to be accountable to the boards of these Companies who in turn are accountable to the shareholders. no one gives a toss.

Bottom line is we have to spend less than we earn and we are not. Unless a real grip is taken of the public finances this Country (amongst others) is headed for third world status within about 20 years.

And there you have it, “if allowed to”. Too often engineers are misunderstood, under valued, and over managed by managers with no engineering knowledge. And that problem reaches all the way to the top, where too few politicians have ever held down a job in the real world. Professionalism has become a curse of our age; we have professional politicians and professional managers; and few of them understand what they are professionally managing. They have so little understanding that a new breed of professional consultants has sprung up to fill the gaps and hold the hands of the professional politicians and managers – and between them all they generally make a fine mess of things. One example is the failed NHS computerised IT system that has cost us all £billions.

There was a time when engineers were managed by engineering managers who themselves were engineers that had worked their way up through the system; managers who understood engineering and the associated issues. Today, all too often, the top manager has a degree in management and little or no understanding of engineering, topped up with a huge personal ego, and rounded off with a vocabulary comprising of 'appropriatly sounding' buzz-words. A professional manager with little engineering know-how tends to be more concerned with rapid personal reward and status than with quality engineering.

AGREED!!! But don't hold your breath; the whole system is managed by the greedy unprofessional professional.

Whether the current levels of defence or any other exports are or aren't significant Geezer, that has no bearing at all on the points oldmalthouse made about British engineering. Many other factors come into play (sales policies, politics, ethics, exchange rates, bribery etc...) to determine export performance unrelated to how good the engineering is.

My point engineering expertise or not the system is broken, Britain will never again attain it's prominent position in the World. Back in the Victorian era we led the World in so many disciplines, the size of our navy and army meant we were able to secure whatever raw materials we needed to make whatever it was we could design and build. In effect we used our might to get to where we were.

Today globalisation means there is a hell of a lot more competition in the World.

The last twenty/twenty-five years have seen a lot of jobs off-shored. Ask yourselves why this has happened. This brings me to current UK motor manufacturing, all the volume manufacturers are foreign owned.
The likes of Nissan and Toyota built plants here to give them manufacturing ability in, and to sell to Europe. They chose Britain at the time due to its experience in motor manufacturing/engineering.
The World and more importantly Europe is changing. If a manufacturer is able to build cars say somewhere in Eastern Europe significantly cheaper (and to the same standard) as they do in the UK why shouldn't they move there manufacturing base?
Skoda is an example. Seen as a joke car in the 80's they were taken over by Volkswagen in 2000. Since then they have upped their game and now make some of the best cars in Europe. These cars are manufactured in some of the former states of Yugoslavia, the Czech republic and India..... No doubt chosen because wage costs are lower than some others..

Globalisation means pretty much anything can be made pretty much anywhere, Companies will always choose to manufacture where it costs them less to do so, yes quality and reliability will play a part in this but the rest of the World is catching up fast on the developed nations.