Manufacturing points to even slower recovery
Manufacturing points to even slower recovery
It is true that there is much to be positive about concerning the future of manufacturing in the north east. The reputation of the skills of workers and employers delivering products on time, to high specification is well earned and well renowned. Retaining major manufacturers like Nissan and attracting large scale manufacturing investment in the form of Hitachi are outcomes that do not happen by accident, they are the culmination of a number of positive factors and much hard work, and they are critical elements to the regional economy that we cannot afford to take for granted.
The vulnerability of our manufacturing base is never far below the surface. The announcement on Thursday of last week that BAe Systems is to close its Scotswood Road site, while not unexpected, is further confirmation that even those sites with among the deepest roots do not come with any automatic guarantees of longevity. BAe has invested in other locations in the region, but is a company retrenching in the face of over £4 billion of defence cuts.
The TUC has always argued that drastic public spending cuts will be as damaging to the private sector as they would to public sector employment and services. The loss of a significant manufacturing facility in Newcastle is not just bad for the region, it is another hole in the national economy and a further blow to the government's stated strategy of 'rebalancing' the economy by growing the private sector.
The following day's news, that manufacturing activity has fallen by its most severe rate for three years only adds to concerns that the current economic philosophy of the coalition government is severely handicapped by a woeful and callous disregard for industrial and employment consequences.
Indeed, faced with headline after headline demonstrating that the single ambition, to reduce the deficit, to be achieved by a single policy, cutting spending, the Prime Minister and the Chancellor take the toxic mix of stubbornness and stupidity to new heights by restating their focus on this sole approach.
In almost all other countries there is an awakening to the fact that the most effective way of balancing the fiscal equations is to concentrate on stimulating growth. The anxiety that failing to dramatically reduce public spending now will lead to uncontrollable pressures from the financial markets can be countered by an improved economic outlook and also mitigated by collective European action to consolidate protection from the predatory actions of international finance speculators. Those anxieties also need to be balanced against the very real concerns that the exclusive focus on the austerity option is directly responsible for either permanent or very long term damage to the industrial economic base in the UK and the cost, financial and social, of the increasingly evident and growing long-term unemployment being experienced by so many workers.
One has to wonder how much evidence that the current plan is not working is needed before the coalition government have the common sense to change direction.
Kevin Rowan
Regional Secretary
Northern TUC
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