A £45 million package of investments in manufacturing research could soften the news of continued pay freezes in the sector.
The first pay data for 2013 suggests the subdued pay environment in manufacturing over the past two years is set to continue, with pay freezes still a feature of negotiations in the main key bargaining period, according to the latest survey on pay data from EEF the manufacturers’ organisation and JAM Recruitment.
But speaking ahead of the Department for Business, Innovation & Skills manufacturing summit today David Willetts, Minister for Universities and Science, revealed a new funding package for 12 research projects and four new research centres through the Engineering and Physical Sciences Research Council (EPSRC).
Mr Willetts said: “The UK has a proud history of manufacturing but to build on this success industry needs access to the very latest science and technology. This £45 million package of investment will see our world-class research base investigating innovative new manufacturing equipment and techniques.
“This will support our industrial strategy in a range of important sectors, driving growth and keeping the UK ahead in the global race.”
Four new research centres, that will develop new ways of manufacturing in the fields of electronics, laser use in production processes, medical devices and food production, have been awarded a total of £21 million.
Six research projects have been awarded a total of £12.2 million to look into the challenges of developing more flexible and adaptive manufacturing technology and systems, including factories that use networks of light-based measurement systems, precise metal forming processes and assembly lines that can evolve and adapt.
A further six projects have been awarded £12 million to improve manufacturing competitiveness in the UK by using the latest ICT developments such as cloud computing, crowdsourcing, gaming technology, ICT dashboards and platforms.
EPSRC’s chief executive, Professor David Delpy said: “Our high labour costs combined with global competition mean that the future of UK manufacturing lies in being as smart as possible.
“The country has the scientific and engineering know-how to not only develop new, valuable products, but the means to produce them more precisely, efficiently and to order. These research projects will help the country gear up for a future that can redefine manufacturing worldwide.”
The news is a welcome boost as the survey on pay data from EEF and JAM Recruitment revealed the proportion of pay freezes in the industry in the three months to end of January remained in line with the average reported throughout last year of about 12 per cent of settlements.
The survey also showed that where a settlement was agreed the average level fell slightly to 2.3 per cent, down from 2.4 per cent for the previous three month period to the end of December 2012 and a shade lower than the 2.5 per cent average deal reported a year ago, with almost 90 per cent of settlements agreed at 3 per cent or less.
Lee Hopley, EEF chief economist, said: “The major January pay round in manufacturing brings few surprises on wage growth, with settlement patterns little changed now for more than two years. These figures continue to suggest a cautious outlook for many companies, particularly those that continue to operate pay freezes.
“While overall pay prospects across the sector look fairly subdued, official figures point to slightly faster earnings growth in manufacturing than the rest of the economy, indicating that the on-going need to attract and retain key skills remains a factor in pay discussions.”
John Morris, chief executive of JAM Recruitment, said: “In the past two months we’ve seen a higher number of vacancies being advertised, including senior positions. Significantly, these are not only for general business management but also for senior technical roles such as engineering directors.
“We’re also seeing clients carrying out a lot of analysis of the age profile of their technical staff, and the realisation in many cases is that there’s a pressing need to nurture the next generation of expertise.
“This is resulting in a real candidate-driven market, particularly for those with proven technical experience in many areas. Second jobbers, those with 3 to 5 years’ experience yet still at the start of their career, are most in demand.
“While the latest figures show a slight decrease in the average settlement, we anticipate these trends will put an upwards pressure on pay in the months ahead.”