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Report calls for 55% boost of UK electronics sector to £120bn

27 June, 2013

The British Government has joined forces with a group of trade bodies in a bid to boost to the size of the UK’s electronic systems sector by 55% and to build a £120bn industry within seven years. If the plan is realised, it will create an extra 150,000 skilled jobs across the UK.

A new strategy document, produced by the Electronic Systems Challenges and Opportunities (Esco) committee, predicts that the sector could account for 7.1% of UK GDP by 2020, placing it among the top five UK industries. Electronics would then support over one million skilled jobs, making it a top five UK employer.

The report, produced for the Department of Business, Innovation and Skills, makes several key recommendations, including measures to improve supply chains and strategic procurement, the skills pipeline and the formation of a think tank to identify future growth sectors. It warns that failure to take immediate action will have implications for the competitiveness of every sector of industry and the UK economy as a whole.

Gambica, the trade body that represents the UK automation and controls industry, led the manufacturing work-stream for the report and recruited Juergen Maier, managing director of Siemens UK and Ireland industry sector, to join the group.

“Industrial electronics – notably instrumentation and automation – has a key part to play in the expansion of the UK’s high-value manufacturing base,” explains Gambica CEO, Graeme Philp. “It generates wealth not only in automation and manufacturing, but also in other sectors.

“The survey that we undertook as part of the Esco report found that around a quarter of the companies that off-shored their manufacturing during the last 20 years have re-shored it,” Philp adds. “The prime reason given for this is the hidden costs associated with off-shoring such as quality control issues. These are much more difficult to manage at a distance.”

Philp: electronics has a key role to play

According to the Office of National Statistics, more than 5,300 companies in the UK classify themselves as electronics systems manufacturers. Together, they employ more than 220,000 people.

The UK already has a reputation as an electronics leader, with 14 of the world’s top 20 semiconductor companies having design and/or manufacturing operations in the UK. However, compared to South Korea, which is similar in size, the UK has previously failed to create strong global electronics brands.

The report calls for a long-term strategic approach between Government and industry to ensure that the right ecosystem is in place to encourage investment and entrepreneurship. It suggests that this will trigger the rise of these high-growth enterprises.

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