Manufacturing Industry: Employment Figures (Hansard, 16 October 1991)

§ The Parliamentary Under-Secretary of State, Department of Employment (Viscount Ullswater)
My Lords, the number of employees in employment in manufacturing industries in Great Britain in February 1991 was 4,917,000, and in July 1991 was 4,748,000. Figures for the intervening months are available if required.

§ Lord Dean of Beswick
My Lords, I am grateful to the Minister for that reply. He must be aware that the latest figures show that over the past six months approximately 3,000 jobs a day have been lost in the manufacturing sector. That has occurred under the present Prime Minister and the present Government. Bearing in mind that the Select Committee of your Lordships' House on this subject has twice signified to the House and to the nation the dangers of allowing the manufacturing base to be continually reduced, why is the Chancellor of the Exchequer going abroad and saying that everything is coming right?

§ Viscount Ullswater
My Lords, we should put the figures into context. During the past 10 years, employment in manufacturing in Great Britain has fallen from 6.1 million to 4.7 million. That reflects the introduction of modern technology, computerisation and robots. During the same 10-year period, employment in service industries has risen from 13.1 million to 15.2 million. Of course, many jobs have been reclassified.

§ Baroness Turner of Camden
My Lords, is the Minister aware that during the Summer Recess, when I had the opportunity to visit the Daf Leyland site near Preston, I discovered that the site, which once employed 13,000 people, now employs only 3,000? Is he also aware that those people, despite a very good record of labour/management relations and a very good productivity record, are most concerned about their future? That is fairly typical of areas of British manufacturing industry. What assurances can the Government give to people in that situation?

§ Viscount Ullswater
My Lords, I believe that the best assurance the Government can give is to point out that during the past 10 years manufacturing has consistently accounted for just under one quarter of total output, the same as in other developed economies such as France and the United States. The United Kingdom is not alone is having a constant ratio in manufacturing output to GDP. In the past 10 years, many countries, such as France, Italy and Germany, have shown the same trend. Therefore, I believe it would be wrong to think that our manufacturing base is being whittled down.

§ The Earl of Onslow
My Lords, is it not true that for the first time in recent years—indeed, for the first time in quite a long time—we have become a net exporter of cars? Due to overseas foreign investment we are producing better cars, more economically and more efficiently, than anyone, including the Germans, in the whole of the European Community. Is that not something for which we should not only be grateful to our Japanese competitors but also to the British working people who have put habits into practice better than their Japanese teachers?

§ Viscount Ullswater
My Lords, I am not certain that my noble friend is correct. However, manufactures were in trade surplus in the three months to August, with exports up by 5.5 per cent. Cars are a particular success story. In the first eight months of 1991, car exports were up 82 per cent. on the corresponding period of last year. Car exports are now worth 75 per cent. of imports compared with 33 per cent. of imports in 1979.

§ Baroness Turner of Camden
My Lords, I thank the Minister for his response to my previous question. Is he aware that, so far as concerns Leyland, its problems arise from the fact that the bottom has dropped out of the UK market? That is largely because of the general recession. The problems which the company faces are caused by lack of orders in this country.

§ Viscount Ullswater
My Lords, we now live in a greater Europe. We have to deal with the market-place in Europe and internationally, and, I am afraid to say, not just rely on our home market. Of course I understand the pressures put upon individual companies. The employment service has a range of ideas and expertise available if people should lose their jobs. However, it is very much the competitive nature of British industry which we must safeguard.

§ Lord Stallard
My Lords, the noble Viscount said that manufacturing employment is not being whittled down. He is quite right in that respect; it has been dramatically reduced. Is he aware that a recent survey of the Amalgamated Engineering Union found that so far this year 122,576 people have been made redundant and are now unemployed? That contributes towards the total figure for the unemployed in this country of over 3 million. How can the Minister be so glib and try to tell us, and people outside the House, that everything in the garden is lovely?

§ Viscount Ullswater
My Lords, I never tried to give that impression. The noble Lord is wrong to suggest that I said that employment was not going down. I said that the manufacturing base is not being whittled down. It remains the same percentage of GDP as it has done over the past 10 years. It is most important to indicate that our output is going up; indeed, it has increased by a quarter in the past 10 years. I also pointed out that many jobs have been reclassified. For example, cleaning and catering are being contracted out and no longer count as manufacturing jobs. Design, marketing and personnel are also being 1098 undertaken by outside contractors and no longer count as manufacturing jobs whereas they did when carried out in-house.

Lord Bruce of Donington
My Lords, can the noble Viscount inform the House whether the figures that he gave in reply to the first Question, and those to which he directed our attention, include part-time workers? If they do, can he tell us how many?

§ Viscount Ullswater
My Lords, I cannot give that number. I shall have to investigate the matter to see whether it is possible to arrive at such a number and then write to the noble Lord.

§ Lord Stoddart of Swindon
My Lords, the noble Viscount mentioned the proportion of services as against manufacturing industry. However, does he recall the Aldington Report of 1985 which warned at the time that we would reduce our manufacturing potential at this country's peril? We need a large manufacturing potential to support such services. Bearing in mind that our overseas earnings from services are reducing, is it not now essential that we substantially increase our manufacturing base? Will the Government take that fact on board and try to do something to increase—and not merely maintain—our manufacturing base? It is upon the increase of that base that this country's future prosperity depends.

§ Viscount Ullswater
My Lords, not only have the Government taken notice of that fact; they have acted upon it. I say that because in the three months to August the UK's trade in manufactured goods was £100 million in surplus and, since 1981, the UK's volume of world trade in manufactures grew faster than that of France, Germany, Italy, the United States and Japan. That is a fine record.

§ Lord Dean of Beswick
My Lords, is the Minister aware that his noble friend who sits behind him who referred to the motor car industry actually painted a somewhat glowing picture? Is the Minister also aware that the domestic market in this country has shown a 20 per cent. drop in the purchase of cars? Is he further aware that, if the decline continues, the threatened layoffs now in the pipeline among motor car manufacturers will obviously take place, bringing danger to the motor car industry? I understand that we may have an opportunity to debate the motor car industry shortly. Therefore, today is perhaps not the time to go into the matter in detail. It would be better to deal with it in a few weeks' time.

§ Viscount Ullswater
My Lords, I believe that I have already answered the noble Lord's question. I said that we cannot now rely entirely on the home market to satisfy the sales demands of the car industry. I also indicated that our exports are 82 per cent. up on the corresponding period of last year.