Let me preface this particular entry with a disclaimer – I have tried and will continue to try and keep this blog as apolitical as possible. I am not approaching this from a political viewpoint, but from a the viewpoint of a HR professional. I will not, in this blog, approach topics politically, or take sides on the left/right political spectrum. Politics can be provocative, especially in these fractious times, and there are lots of people far more qualified to comment on politics than I. However, when areas of policy stray into my area of expertise, those policies will face my objective scrutiny. Such an event happened recently. So can we discuss a policy without getting political?
The leader of the official opposition in the UK, a Mr Jeremy Corbyn, recently gave a speech in which he outlined his vision for a future Britain. If you’re interested, you can read the speech here. Doubtless to many of his followers, particularly those who getting on in years, it represents something positive.
I beg to differ.
There is a lot to pick apart during this speech, but let me focus on the theme of revamping the UK’s economic model away from service industries to instead focus on manufacturing, with a view of how realistic this is given the current workforce. To be fair to Mr Corbyn, he didn’t elaborate much on the sort of manufacturing he wanted to bring to the UK. To be fair to myself, he didn’t really need to. Beyond mentioning building ships and trains there wasn’t much else here. Of course trains and ships have their fans, but they’re products which are difficult to export, consume enormous levels of resources, and are extremely wasteful to make if you manufacture beyond capacity; potentially hazardous if you already have a $235bn negative trade balance. And other than that? I don’t think his vision is a reasonable goal.
Firstly, the UK already has a pretty solid manufacturing industry. It’s not as large as it used to be as a share of GDP but it is still very much alive and well. Back in the 1970s UK manufacturing represented around 25% of GDP. In 2016 it was 10%. But the fall in manufacturing output as a proportion of GDP is somewhat misleading. The UK hasn’t abandoned manufacturing, but has shifted away from mass-manufacturing and instead morphed into high-tech, high value, and specialist products. A good example is the aerospace industry, of which the UK has the second or third largest in the world. Broughton manufactures, among other things, the wings for the Airbus A380 super jumbo. Each and every one of these aircraft has a unit cost $447 million USD. So one unit alone is many times the value of most UK companies. Additionally, this kind of manufacturing is heavily dependent on both international supply chains and orders made very far in advance. In the example of the A380 – the fuselage is built in Germany, with some other parts being built in France and Spain, before the entire thing is assembled in Hamburg. If Mr Corbyn wanted to expand the Broughton plant and build more A380 wings, he’d be wasting money and resources to wind up with a lot of unsaleable wings.
Secondly, Corbyn speaks about the service industry and singles out the financial industry. Again, to be fair to Corbyn a common mistake lay-people make when they hear the words “service sector” is to think only of banking and finance. Again, to be fair to myself he isn’t a layman, he is the leader of the UK opposition and should make more of an effort to at least understand these things. The British financial sector is extremely important, representing anything between 13-17% of GDP over the past decade. But that certainly isn’t the only type of service industry the UK has. Corbyn doesn’t appear to touch on the educational, cultural, media, scientific, medical, music, defense, and tourism service sectors. For example, the education sector generates £95 billion for the UK economy and supports nearly a million jobs. Not only does this sector generate economic activity, but it also turns out that thing the UK sorely lacks right now – qualified and skilled workers.
Thirdly, his claim that manufacturing industries rather than service industries encourage “dynamism” is, in my opinion, horribly misguided. If anything the reverse is the case – as someone who has worked in both service and manufacturing I can tell you from experience that it is generally harder and more costly to retool a factory to construct something different than it is to adapt a service to provide something different. Indeed some of the service industry are already tailored to provide something different, as is the case with the media industry. Pinewood studios in Buckinghamshire were heavily involved in the production of the recent Star Wars movies, several of the Marvel movies, and the recent Jurassic World movie, this is as well as very different productions made for TV such as Taskmaster or Teletubbies. If a particular genre of entertainment becomes popular the media services can adapt and produce that. But if a particular product falls out of favour a manufacturer of that product will start to struggle.
In summation, there isn’t anything wrong with being a service based economy, the UK still has an impressive manufacturing base, and it is simply not true to say that less manufacturing and more services reduces the dynamism of the economy.
But what does all this have to do with HR?
Corbyn’s plan to bring back mid-level or mass manufacturing would put the UK workforce in direct competition with the workforces in the far-east. These countries have extremely low levels of employee rights and protections, with wages that would be prohibitively low in the west. Though wages for Chinese factory workers have almost tripled in the past decade according to some estimates, average Chinese factory worker still earns roughly $580 USD per month, and even China is starting to lose some low tech manufacturing to countries like Indonesia and Sri Lanka, where the wages are even lower (as little as $0.50 per hour in Sri Lanka). To remain competitive the UK would either have to dramatically lower the standards of workers protections and abolish the minimum wage, or institute protectionist measures against organisations or countries which have products produced in the far-east. Such protectionist measures would almost certainly mean that products manufactured in the UK would only be available for the UK market, meaning they’d do nothing for the UK’s huge negative trade balance in goods, as well as risking driving large companies out of the UK.
There is another, even bigger barrier to creating thousands or even millions of these jobs, which I am sure some of you are already yelling at your monitor right now. The dreaded robots are among us, building things faster, cheaper, with more precision, and higher quality than mere human beings ever could. Automation is advancing like never before, and with increasingly sophisticated AI it is not inconcievable that a factory could be designed in such a way that it operated without a single human present. Robots aren’t just building our cars and processing our transactions, they’re actually picking our fruit. They do it better as well, now being advanced enough to assess the ripness of fruits and leave alone those that need more time. They need only electricity to operate, take no breaks, and can work all day.
They also manufacture with consistent quality. My husband, an engineer with a few years experience in the auto repair industry, has told me there used to be such a thing as a “Friday afternoon car” (and sometimes “Monday morning car”). According to a legend passed down by car mechanics back when most of the construction was done by human hands, a car being built on a Friday afternoon, when most of the workforce were eager to get out and start their weekend, was a car with life-long issues due to the job being rushed or done half-heartedly. Such cars were apparently more prone to faults and breakdowns than other seemingly identical cars. But this became history once robots (who don’t look forward to Friday afternoons) started to do a lot of the manufacturing work. While the phrase might be considered somewhat insulting to the old UK auto industry, it was apparently a common enough occurrence that the mechanics who taught my husband passed this little bit of mechanic folklore on.
Even if bringing mass manufacturing back to the UK was feasible, would it be desirable? Employment levels are currently very high, and the majority of the workforce operate in the service sector. Whilst most people involved in high end manufacturing do have often have passion in their work, the same can’t be said for the type of mass manufacturing which produces general goods in bulk, who’s principle motivations are basically adequate pay and conditions rather than internal motivators. This lack of enthusiasm for ones field of work isn’t the case in a lot of service industries. For example, artists working in the movie industry, working on concepts and designing sets, as well as those who then build them, take a great deal of pride in what they produce. In these sorts of creative industries a lot of people thrive on the work itself and don’t necessarily think of it as a job. It isn’t just in creative industries that this applies. Many in the healthcare industry work long hours for the benefit of others first, and take a great deal of pride in what they do. People in the legal industry are often passionate about their career and professional reputation moreso than their paycheck or conditions, the same for engineers, scientists, doctors, economists, or HR professionals. Moves to sideline services might well see the talents of such people going to waste.
Corbyn’s vision – full employment, a job for life after education, mass-manufacturing, fewer services – is not only outdated, but is a model that would substitute careers for jobs and a passion for our work with ‘a fair days pay for a fair days work’. We have moved on from this outlook and, in the opinion of this particular HR feline, it is no great loss. Work shouldn’t be drudgery. Flexibility at work, life long learning, and even trying a few career paths and not settling on one profession have improved our working lives as much as employment rights and better wages have. While it is true that too many people have not benefited from this brave new world, perhaps the answer is to see how to bring more people into it, as opposed to tearing it down and going back to the old days of working the same job as your father and your fathers father, with the loss of opportunity and freedom to pursue a career you love that would entail.
Time is a river that carries us and the world with it and it’s a useless effort to try and swim against it. The river branches and turns often though, and we can choose which branch to take, but not if we spend all our energy trying to move backwards. The people pushing Brexit, regardless of where they lie on the political spectrum, appear to be chasing a vision of some utopic past, rather than trying to influence the future. Brexit might be able to work and improve the lives of people in Britain, I don’t really know one way or the other (though I do have an informed opinion). What I do know is that if Brexit is a prosecuted purely as a nostalgia driven project to turn the clock back a century then it will destroy a 100 years of progress, and that will be good for nobody.