1. Manufacturing in the UK
AQA GCE Business Studies
A2 BUSS4 Section A
Manufacturing in the UK
The Importance of Manufacturing in the UK &
How this is Changing over Time
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2. Role & Importance of Manufacturing © APT Initiatives Limited, 2014
Wealth Creation
Production of goods for internal use,
or for sale overseas (exports) - with
the income used to fund essential
goods from overseas (imports).
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3. Role & Importance of Manufacturing © APT Initiatives Limited, 2014
Job Creation
Reliant on utilising skills and abilities of the labour force.
The more innovative and productive
the UK is in relation to competitors
(other countries), the greater the
amount of wealth that can be
distributed among its people.
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4. Key UK Manufacturing Statistics © APT Initiatives Limited, 2014
In 2013 generated $219,036 million.
11th largest manufacturer in world.
Generates 10% GDP (5 years
running).
Employs 7.8% (2.6 million) of
workforce.
Exports 53% of all exports (2012).
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5. Key UK Manufacturing Statistics © APT Initiatives Limited, 2014
Absolute growth: 2007 double 1958 output.
Declining position internationally -
birthplace of industrial revolution 18th C
- largest, most influential economy.
Other countries caught up - surpassed
UK with investment in new technologies.
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6. Key UK Manufacturing Statistics © APT Initiatives Limited, 2014
Declining position relative to services.
Natural progression as economy develops.
But… Inter-industry linkages -
Manufacturing firms provide vital
inputs to other sectors eg
pharmaceutical firms supply health sector;
F&B firms supply retailers, hoteliers, etc.
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7. Changing Role and Importance © APT Initiatives Limited, 2014
Productivity Growth
The higher the productivity
(output in relation to inputs), the…
lower the cost, the… more price
competitive and / or profitable.
NB Decline in people employed in manufacturing - partly explained by improvements in productivity
(and trend to outsource / offshore).
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8. Changing Role and Importance © APT Initiatives Limited, 2014
Driving Innovation
New products / processes
may be essential to:
maintain / increase competitiveness.
cope with other global challenges eg
shortages of commodities,
rising energy costs.
© APT Initiatives Limited, 2014

9. Changing Role and Importance © APT Initiatives Limited, 2014
Growth in Exports
Creates jobs and helps…
…pay for essential imports.
…improve trade deficit.
…recover from recessions.
…increase productivity - as
firms that export typically have
to become more competitive.
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10. Other Key Roles Re-balancing the economy away from financial services.
Reducing
energy and resource consumption
and greenhouse gas emissions.
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11. Key Factors Affecting Importance
Rapid pace of
technological change.
Increasing globalisation…
…international competition.
Government policy.
Impact of each of the above
on businesses manufacturing
In the UK - key areas to research.
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