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The Welsh Manufacturing Sector Must Think Globally

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This article has been submitted by Barclays

The Welsh manufacturing sector must think globally and capitalise on opportunities presented by overseas markets after Brexit.

That was the message from the Secretary of State for Wales, Alun Cairns, when he met leading companies in South Wales.

Speaking at the inaugural Barclays Welsh Manufacturing event at SPTS Technologies in Newport, Mr Cairns said, “the world leading skills and knowledge we have in Wales is envied the world over”.

The manufacturing sector in Wales is made up of over 5,000 companies, employing around 150,000 people and the sector is growing with 22,000 more jobs in the sector in Wales than in 2010.

He urged Welsh manufacturers of all sizes to seize the support available from the UK Government to identify opportunities to sell their products in global markets and called for closer collaboration between the sector and the UK and Welsh Governments to help address the challenges the sector faces, including resourcing a skilled workforce and the wider economic challenge of productivity.

The Secretary of State said,

“The close relationship between industry and government stand only to benefit manufacturers in Wales. We need to promote the products we are producing in Wales on the global stage to drive prosperity levels upwards and help close the productivity gap. As a nation, we need to redouble our efforts to create a ripe environment for business, to promote strong work opportunities, to improve productivity and to raise our game across the board.”

Mr Cairns added that the event in Newport was an opportunity to hear about various businesses’ priorities for EU exit. Unemployment in Wales is at an historical low but there is still room to raise productivity and make its manufacturers more competitive than European rivals, the meeting heard.

Keiron Singleton VP of Finance at SPTS Technology commented

“SPTS exports more than 95% of the equipment we manufacture here in Wales, so it’s particularly important for that one of the outcomes of Brexit is the continued free movement of our products to EU customers without extra licenses or tariffs and the continued free movement of our staff to service them. Our ‘responsiveness’ to both supply and service our EU customers is a key competitive differentiators against foreign competitors.

SPTS also needs to be able to continue to attract skilled employees from the EU, while we develop our own skilled workforce to bridge the skills gap and aging skilled workforce that currently exists.”

Turning to the City Deal for Cardiff, the Secretary of State said it had come about as a direct result of the desire for businesses in the semi-conductor sector to work together and develop their cluster of expertise and this now has to be raised to the next level to build on the opportunities to boost productivity and lower costs.

He said this City Deal and another for Swansea were driven by requests from participants, business and academia, and he urged the manufacturing sector to come together and agree on their priorities and desires and to seek Government support to achieve them in a similar way to the City Deals concept.

Simon Vittle, Head of Manufacturing for Barclays in Wales, said all the feedback they were getting from a wide range of industries was that more financial providers in public and private sector are now returning to support manufacturing and Finance Wales was being singled out for its unique position in the UK and its pro-active operations.

David Davies, managing director of Axiom Manufacturing Services, Newbridge, expressed concern over Welsh Government policies and the promotion of Wales as a destination for manufacturing and a place from which to do business while it plans to raise taxes for industrial land and development.

Turning to skills he said,

“We need to correlate education with real quality jobs and not just encourage higher education for the sake of it. We take in schoolchildren for experience days so they understand what modern industry is and how they can then consider engineering as a future career.”

He suggested there is a great need for organisations’ bodies and businesses to take out some middle-ranking management which is no longer needed in today’s manufacturing and for encouragement to be given to universities to provide courses which are relevant to what manufacturing wants today, not what it had a decade ago.

The Chief financial officer of Creo Medical, Chepstow, Richard Rees, responded by saying

“I believe there should be a change in funding so businesses receive grants and support to educate and train young people in-house in larger numbers. This will equip them with the skills they need for particular manufacturers and encourage them to stay with firms which have invested in them.”