The idea that the UK needs a coherent industrial strategy is gaining credibility. Central to it is technology and engineering. Grant Murgatroyd asks what a strategy would need to address – and, crucially, how innovation could be financed.
Engineers were first referred to in the 14th century – when the term was applied to operators of military machinery. In the subsequent seven centuries, engineering has moved from the battlefield to drive profound economic and social change. From the steam engine to the electric telegraph, automobile, aeroplane and computer, huge fortunes have been made – and lost – off the back of engineering innovation.
The UK, once the world leader, still punches above its weight. According to Engineering UK, the sector contributed an estimated £455.6bn (27.1%), of the UK’s £1.68trn GDP in 2014 (for which statistics are available). Engineering enterprises produced turnover of £1.17trn, and employ 5.4 million people in the UK. It is forecast that they will create 2.56 million new jobs by 2022.
It would not be overplaying the sector’s importance to say that the success of the engineering sector is absolutely essential to the future prosperity of the UK. But if it is to maintain its position in the sector, the UK must help drive innovation. Success is never guaranteed, and in many sub-sectors the winner takes it all.
Members of the Corporate Finance Faculty and Faculties Online
Full article only available to Corporate Finance Faculty members and subscribers to Faculties Online.
If you would like to read this article in full why not join the Corporate Finance Faculty and gain member access to all member only content.