THE North East's reputation as a centre of excellence for cutting-edge engineering is underlined today by a new report which identifies the region as a “hotspot” for the sector.
The region has been named as one of the leading areas for high-value engineering (HVE) in the UK in the report published by the Royal Bank of Scotland today.
According to the paper, the sector, which includes nanotechnology, composite materials and 3D printing, is expected to be worth some £805bn in 2015, employing 400,000 people.
The report is published on the day that the Ernst & Young Manufacturers League is relaunched at an event in Newcastle. The first league table of the North East’s fastest-growing manufacturing businesses will be published in The Journal tomorrow following a 10-year absence. Today’s report by RBS identifies the North East as a front-runner in the global race to become a leading centre for HVE due to the presence of the Centre for Process Innovation (CPI) at Wilton and Sedgefield.
The technology innovation centre serves the chemicals, pharmaceuticals, food and beverage, biotechnology, printable electronics and energy markets.
The CPI, with its £55m asset base, is one of seven partners working together to form the High Value Manufacturing Catapult, which opened its doors for business in October last year.
It is one of seven “catapult” centres being set up around the country by the Technology Strategy Board, to help bridge the gap between business, academia, research and government.
And the RBS report, entitled The Future of UK High Value Engineering, has stated there is a clear correlation between the catapult centres and the regions that UK manufacturing business leaders have predicted will take the lead in a new high-value engineering revolution.
However, it warns that while most businesses recognise the global competitive edge provided by the high standard of R&D in the UK, it found that only one in 10 businesses were planning to increase their R&D spend beyond current levels over the next two to five years.
The report concluded that the other two challenges the UK must overcome to compete are the shortage of a skilled workforce and restricted supply chains.
John Dryden, regional director for the North East at RBS, said: “Engineering companies need to act now to secure future growth – for themselves and the UK as a whole.
“New technology and techniques are quickly changing the landscape of manufacturing and we must be able to exploit these opportunities.
“For the UK to be able to compete internationally, expenditure on research and development in tomorrow’s technologies must increase substantially.” According to the report, Sunderland is also a HVE hot spot, lying third in the top 10 towns and regions in Great Britain with the highest number of jobs in the HVE segment. Only Aberdeen and Glasgow have more people working in the sector.
The UK is the ninth largest manufacturing nation in the world and high-value engineering accounts for 35% of all exports and contributes £151bn worth of value toward the UK’s balance of payments.
In the report, Peter Russell, head of manufacturing and industrials at RBS Corporate and Institutional Banking, stated: “I am hugely excited at the outlook for the HVE segment over the coming years.
“What is evident from this report is just how much knowledge and capability, not to mention success, already exists within the UK.”
:: Don’t miss your 12-page supplement featuring the first Ernst & Young Manufacturers’ League table free with The Journal tomorrow.