The critical importance of the UK agreeing a deal with the EU which avoids barriers to trade is highlighted today by new analysis which shows that manufacturing exports to the top six EU markets alone are worth around a third of total goods exports.
Top six European markets account for a third of total manufacturing exports
UK goods exported to the US jumped by 19% year-on-year
UK retained position as 9th largest manufacturer and 10th for global exports
Average pay in manufacturing - £34,538 - remains significantly higher than services and economy overall
According to the research, ‘UK Manufacturing Facts, 2020/21’, published by Make UK, the manufacturers’ association, and Santander UK, total global exports stood at £367bn. While the US was the single largest importer of UK manufactured products, seven out of the top ten UK export markets are based in Europe, including Germany (2nd), France (3rd) and Ireland (4th). China, ranked fifth, was the only other top ten destination for UK goods outside of Europe and the US.
Exports to the top six European markets – Germany, France, Ireland, Netherlands, Switzerland and Belgium – were worth £117.4bn alone. Just under half (46%) of all UK manufactured goods were exported to European countries combined, totalling £169bn. The US was the single biggest export destination and saw a 19% increase on last year, equating to £54.4bn.
The research also showed that the UK retained its position as the ninth leading manufacturer and tenth in terms of global exports with output totalling £191bn in 2019 – a growth of 7% over the last five years. The data also reveals that among the 2.7 million people employed by UK manufacturers, the average salary stands at £34,538 – 13% higher than the average UK salary.
These figures lay bare the overwhelming importance for manufacturers of trade with our closest market and the need to avoid imposing any barriers which will make this more difficult.
Whilst the United States remains the biggest market and presents significant opportunities for export growth, it is a fallacy to believe that geography is not the biggest factor driving trade. For UK manufacturers, access to their biggest market must be a premium.
The figures also provide an important reminder that we’re still one of the top ten biggest manufacturing nations and we want to see policy makers working with industry to help move UK manufacturing up the rankings.
Chief Executive at Make UK
According to the data, Transport Manufacturers were the largest exporters (22%); Food and Drink remained the leading subsector for output (17%) while; Transport also generated the most in terms of R&D (36.4%). This spend on R&D highlights the critical importance of the automotive and aerospace sectors to the long-term high value growth of the economy, despite the major impact of the pandemic on these two sectors in particular.
The data, captured before the Coronavirus outbreak shows that goods exports (53%) outweighed that of services (47%) while the sector continues to punch above its weight contributing 66% of total UK spend on R&D and 16% of business investment.
Our manufacturers have shown unyielding resilience over recent months. Retaining our position as the ninth leading manufacturer makes it clear that the UK is still a major player on the international stage, but we must not rest on our laurels. This data underlines the importance of prioritising manufacturing as the UK establishes new trading relationships with partners around the world.
UK Head of Manufacturing, Santander UK
The ONS has made some revisions to manufacturing output for the last few years. The figure for 2018 of £192 billion was revised down to £190 billion hence why this year’s figure appears lower than the figure quoted in the 2019 Make UK/Santander Fact Card.