Job Losses in Manufacturing (Hansard, 21 January 1993)

§ The Parliamentary Under-Secretary of State, Department of Employment (Viscount Ullswater)
My Lords, the number of employees in manufacturing in Great Britain fell by 253,000 in the year to November 1992.

§ Lord Dean of Beswick
My Lords, is it not a fact contained within the figures the Minister has just given that the November figure was the highest of any month of the year? I understand that the December figure is similar. I believe that the figure for November was 31,000. Does not that contradict the rather dubious reports which have been made about an industrial recovery?
I hope that in his answer the Minister will not refer to the change in designation of jobs, because when a shipyard closes, when an aircraft factory is under threat of closure and when an engineering company closes that has nothing to do with differences in classification. It is the result of the industrial mutilation indulged in by this Government. Does the Minister not accept that even a former Conservative Prime Minister—Mr. Heath—stated in another place that this Government had gone far too far in weakening our industrial base? For God's sake, when is it going to stop?

§ Viscount Ullswater
My Lords, the noble Lord is correct: 31,000 jobs were lost in November. Obviously manufacturing industry has suffered during the recession. However, manufacturing industry can be expected to gain from the package of measures announced in the Autumn Statement which were aimed at boosting investment, exports in the car industry and also the housing industry and construction. Those measures, together with the significant reduction in interest rates to 7 per cent. and the appreciation in sterling against our major competitors, will take time to work through but they will all have a positive impact on manufacturing.

§ Viscount Caldecote
My Lords, while it is of the greatest importance to increase job opportunities in every possible way, does my noble friend agree that the reduction in the number of jobs in manufacturing industry is due mainly to increased industrial 963 productivity? Does he agree that the principal task of manufacturing industry is to increase its orders and its output through greater competitiveness and that that will lead to more jobs in the supporting service industries but not necessarily in manufacturing industry itself?

§ Viscount Ullswater
Yes, my Lords, it is indeed a factor. We have been increasing the productivity of manufacturing industry even in a recession, which is unusual. The only real basis for economic growth and lasting employment is low inflation and a competitive and efficient economy. Inflation is now at its lowest level for six and a half years, unit wage cost figures published today show that the competitive position of the UK economy continues to strengthen and a strong economy will lead to a growth in jobs.

§ Lord Dormand of Easington
My Lords, is the Minister aware that the unemployment figures announced today show yet another huge increase —60,800—most of which is in manufacturing? Further, did he hear the director of the CBI say this morning that there is no sign of the famous green shoots which we keep hearing about from the Government? Will he say for how many consecutive months there has now been an increase in unemployment and what is to be done about the manufacturing base?

§ Viscount Ullswater
My Lords, of course the Government are deeply concerned about the personal hardship suffered by unemployed people and their families. The December increase in unemployment is very disappointing. However, it reflects world economic circumstances and the fact that the UK economy has gone through a difficult period.

§ Lord Mason of Barnsley
My Lords, is the Minister aware that in 1979 manufacturing jobs in Great Britain totalled 7 million whereas today the figure is down to 4.3 million, a loss of 2.7 million manufacturing jobs? Does he really believe that that is the result of increased productivity?

§ Viscount Ullswater
My Lords, I believe that the reduction in manufacturing jobs which the noble Lord quotes tells only half the story, the other half of which is the increase of nearly 2 million jobs in the service sector in the last 10 years alone. That more than offsets the job losses of 1.3 million in manufacturing in the past 10 years; and that is to say nothing about the increase in the number of the self-employed of 800,000 in that period.

§ Lord Plummer of St. Marylebone
My Lords, can the Minister say how many jobs were lost in the manufacturing sector in Greater London? Is he aware that in the past successive governments have paid manufacturing industry to leave London, causing the gradual downturn which has resulted in it now being the worst economic sector in the country?

§ Viscount Ullswater
My Lords, I cannot for the moment put my finger on the number of jobs lost in manufacturing industry in Greater London. I shall endeavour to do so and write to my noble friend. I 964 understand his concern. It is true that unemployment in the Greater London area has increased at a higher rate than in the rest of the country.

§ Lord Ewing of Kirkford
My Lords, is the Minister aware that many of the job losses in the manufacturing sector to which he has referred have manifested themselves in today's horrendous increase in unemployment? Does he accept that the unemployment figures are a national scandal? Is there any comprehension within Her Majesty's Government of the social consequences of such high unemployment throughout this country?

§ Viscount Ullswater
My Lords, I believe that the noble Lord should cast his eyes a little further and not merely consider the issue from the point of view of an island nation, which indeed this is. What is happening in the rest of Europe presents no prettier a picture than what is happening here. The whole of the European Community, for which the unemployment figure is about 17 million, is turning its attention very carefully to ways of increasing jobs rather than decreasing them, which the Social Chapter has set out to do.

§ Lord Clark of Kempston
My Lords, does my noble friend not agree that to compare the unemployment rate for 1979 with the level of unemployment today is misleading? Is it not well recognised that in 1979 the overmanning in manufacturing industry in particular—in the steel industry, for example—had to be removed in order to make industry more competitive and that as a consequence unemployment had to rise? As my noble friend said, many of those jobs have been taken over by the service sector. I believe that that comparison between 1979 and today is quite wrong. It also overlooks the question of automation.

§ Viscount Ullswater
My Lords, I agree with my noble friend that overmanning was rampant in the late 1970s. I would also point out that the workforce in employment has increased by 1.4 million since March 1983, which was the last trough in the unemployment figures.

§ Baroness Turner of Camden
My Lords—

§ Lord Hesketh
My Lords, we have now passed into the 25th minute, which means that we are in the 26th minute, and we have one more Question to go. That means that we must move on to the next Question.