In July, Professor David Bailey (Coventry University Business School) reported that “repatriating activity – including some sourcing – to the UK is very much on the agenda”. 

He summarised the impact of offshoring on British manufacturing over the last decade, and considered the tentative signs of “onshoring” in certain sectors.

This is due to a combination of factors, including:

  • a more competitive exchange rate (despite the very recent appreciation of sterling),
  • increased transport costs,
  • rising wages in key areas of China,
  • and a greater awareness of supply chain resilience, in the wake of disruption due to the Japanese earthquake and tsunami.

Policies needed to rebuild manufacturing capacity on a more significant scale

Professor Bailey believes that the UK needs to consider how it can tailor an industrial policy focused on building manufacturing capacity, particularly in the supply chain. There is a ‘window of opportunity’ here but a major policy effort is needed to make this happen on a significant scale. 

Homeward Bound? Seizing Manufacturing Onshoring Opportunities, is the first of three blogs this week which develops and extends his recent Birmingham Post column on ‘onshoring’ opportunities in manufacturing.

It can be found here. Part 2 is on Wednesday and Part 3 on Friday.