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A wish list for the manufacturing sector

Innovation, skills, tax incentives, investment and support for SMEs are the key issues facing the manufacturing sector as we get nearer to the General Election. That is, according to the All-Party Parliamentary Manufacturing Group (APMG) that recently published a Manufacturing Manifesto aimed at keeping the challenges facing the sector on the radar of the major political parties.

The APMG, which is made up of politicians as well as representatives from manufacturing industry organisations, says that long-term government policies devised in collaboration with industry is the “single best way to instil confidence and stability in the UK manufacturing sector”.

Here’s a précis of the things they are calling for.

SMEs

Small and Medium Enterprises make up the majority of manufacturing businesses in the UK, so the APMG would like to see support given to these companies. It is calling for a more diversified funding environment, through a mix of business angels, venture capitalists, private equity, bank finance, and crowdfunding; as well as “a permanent and robust advisory service dedicated to supporting SMEs”. It would also like to see information for SMES disseminated through trade associations, local enterprise partnerships, universities and chambers of commerce.

 

Trade and Investment

Measures being demanded include support to businesses looking to locate or re-locate production in the UK; an expansion of the capacity of UK supply chains; and a commitment to encourage international business links and foreign direct investment to aid the export of manufactured goods.

 

Innovation

The APMG would like to see all parties committing to protect funding for bodies such as Innovate UK and the High Value Manufacturing Catapult. In addition, there is a call for strong protection Intellectual Property rights and a permanent system of R&D tax credits to be established.

 

Skills

When it comes to skills, the APMG wants to see engineering and STEM-related apprenticeships made a priority and has called for stronger links between education bodies and industry. All parties are being urged to address the negative perception of manufacturing and to take steps aimed at increasing the number of women coming into manufacturing and engineering.

 

Finance and taxation

There are calls also for a competitive tax regime as well as steps to streamline the process of applying for government support schemes. Strategies to support high employment manufacturing industries, such as textiles and food and drink, are requested.

 

Overall, the manifesto represents a comprehensive list of the main issues facing our sector and a useful rundown of action points needed to support the resurgence in UK manufacturing we have witnessed in recent years. It remains to be seen how far this is adopted by politicians as we enter this important year.

 

 

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Reshoring UK manufacturing – bringing jobs back to Britain

Industry watchers have been talking about the trend towards reshoring UK manufacturing for a number of years now.

The term describes moves by British companies to bring home parts of their operation that they had previously moved offshore. During the 1990s and early 2000s, the trend was towards firms relocating production and assembly to destinations where labour was cheaper, such as China and Eastern Europe. However, recent figures show that this tendency is being reversed to an extent.

Earlier this year, manufacturing lobby group EEF published details of a survey which revealed one in six of UK manufacturers had “re-shored” elements of their activity back to the UK in the past three years. Key reasons for doing so was the ability to keep closer control over quality and improved delivery times.

According to professional services consultants PWC, other factors driving this trend include the lessening wage gap between the UK and emerging economies, and the rising price of international transport. While low wages have seen living standards stagnate in the UK in recent times, it would seem a more fortuitous by-product is they are helping to bring jobs back to these shores.

UK Trade & Investment (UKTI) says it has identified around 1,500 manufacturing jobs that have been brought back due to reshoring but PWC estimates the trend could eventually create hundreds of thousands of new UK jobs over the next decade, and lift annual national output by around £6-12 billion. It says sectors such as textiles and electrical equipment manufacturing could benefit while extra jobs in research and development, back-office services and telecommunications could be generated.

The firm has called on policymakers to support firms bringing business back to the UK by making the tax regime more competitive, improving transport infrastructure and helping businesses working in the same fields to come together. The Government says part of its Industrial Strategy is to develop a long-term partnership between government and business to provide confidence for investment and growth, particularly in manufacturing.

In addition, the Manufacturing Advisory Service (MAS) has partnered with UK Trade & Investment (UKTI) to launch Reshore UK, hailed as a “one-stop-shop service to help companies bring production back to the UK”. It is intended that the new service will provide advice as well as a matching and location service for company’s returning activities here. It says it wants to support small and medium sized businesses “to be globally competitive and to ensure there is capacity in the UK supply chain to take advantage of the reshoring opportunities”.

While it isn’t time to get the bunting out just yet – there are still a small proportion of UK firms moving work away from the UK – this is a hugely encouraging trend for UK manufacturing and the economy as a whole, and one we as a country must do all we can to encourage.

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New Belotti 5-axis CNC Machining

At DaRo Products we strive to keep up to date with technology ensuring our production processes are efficient as possible. Which is why we have recently invested in a new Belotti 5-axis CNC machining centre.

The new machine allows us to trim, drill and machine products at a much faster rate, saving time and money, resulting in cost savings for our customers. But perhaps the biggest advantage is the high level of quality and consistency that comes from this machine rather than traditional methods of finishing.

This machine gives us the added advantage of being able to receive CAD files directly from our customer, or designing a product in-house using Solidworks, allowing precision and accuracy that can be sent directly to the machine to be manufactured.

Not only does this machine give us the competitive edge for product finishing but also enables us to produce vacuum form tooling in-house for greatly reduced lead times for new jobs.

Take a look at our Belotti 5-axis CNC machining centre in action:

 

To find out more about our  services call us now on 01787 881191 or email us.

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Why should the UK invest in more manufacturing?

Despite the perpetual doom and gloom attitude by some in the manufacturing sector, recent figures about the health of UK industry make fairly good reading. According to statistics from the House of Commons Library, manufacturing output rose by 0.1% in August 2014 compared with July 2014, and was 3.9% higher than in August 2013. In Q2 2014 there were 2.6 million jobs in the manufacturing sector – around 8% of all jobs in the UK. This was an increase of 31,000 over the quarter and of 49,000 over the year –on the face of it a decent recovery for manufacturing from the downturn.

However, these figures have to be seen in light of the recession and manufacturing output in the UK remains over 4% lower than pre-downturn levels. They should also be viewed with regard to the global picture that shows manufacturing output per capita in the UK lags behind our fellow developed nations.

Using the most recent figures available, in 2012, out of 237 countries in the world, the UK ranked 7th in terms of manufacturing output at $233 billion – this was slightly above the French but little more than  half of German manufacturing output. The UK was also 23rd in terms of manufacturing output per head at $3,700 – this was above the world average $1,300 but below the developed economies of Germany ($7,600), Japan ($7,500), and the US ($6,000)

In terms of manufacturing as a proportion of GNP, the UK has fallen from 15th in the world in 1970 to 114th in the world in 2012. This is because manufacturing has grown in other parts of the world and the UK economy has diversified with the service industries contributing a far larger proportion now than 40 years ago.

Parliament is making all the right noises and has made pledges around boosting the development of 11 key sectors including aerospace, offshore wind and IT, and supporting the development of eight key technologies like satellites, robotics and advanced materials. There have also been commitments to increasing access to finance for businesses, developing the skills of employees in key sectors and using public procurement to create opportunities for UK firms and supply chains.

But we need to see more investment in manufacturing and here are two reasons why. he sector has shown itself to be super adaptable to changing conditions and technologies and despite a dramatic fall in the number of jobs in manufacturing since 1978 output has actually increased in that time. The Government should back a winner – a sector that has grown to become increasingly competitive because it has had to

There is also a drastic need to rebalance te economy and increase exports. The last recession exposed the danger of relying too much on financial services and consumer spending, and many believe that by encouraging more businesses that actually make things the economy will be more robust

Exports are also a concern and have yet to really increase since the Government pledged to double them to £1trillion per year by 2020. More support from Government in this area is sorely needed.

One positive is Vince Cable’s recent proposals to increase the national minimum wage for apprentices, making apprenticeships more financially attractive route for young people. By encouraging young people into the manufacturing sector to earn while they learn, we are investing in the future skills of our workforce and therefore the future health of our economy.

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“DaRo Products are proud to be associated with Nordson DAGE in the prototype development and manufacture of their new X-Ray Cabinet

Nordson DAGE (A division of Nordson Corporation – NASDAQ: NDSN); designers and manufacturers of multi-award winning x-ray systems for the electronics industry, turned to DaRo Products when it came to building their latest concept – the XM8000 (shown below) and the product was previewed last month (January 20th – 22nd 14) at the SEMI European 3D TSV Summit which took place in Grenoble in France.
The Nordson DAGE XM8000 offers fast automatic X-ray measurement of TSVs, 3D packages, MEMS and wafer bumps for voiding, fill level, overlay and other critical dimensions.
This new platform takes the market-leading capabilities from Nordson DAGE’s existing X-ray systems to provide an automated, high-throughput X-ray metrology and defect review system for both optically hidden and visible features of TSVs, 2.5D and 3D IC packages, MEMS and wafer bumps.

DAGE X-Ray Cabinet

This was an exciting new development for DaRo Products who, can expand into other areas of x-ray technology as will now receive further approval for work on lead-lined cabinets for x-ray equipment and other equipment giving off similar levels of radioactive emission.

DaRo Products continue to expand their horizons, and the philosophy of real customer partnerships coupled with a disciplined continuous improvement programme is really opening up new and exciting markets.

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