Manufacturing to drive UK recovery

London - Business secretary Peter Mandelson is targeting a renaissance in UK manufacturing, helped by the emerging low carbon economy, as the core element of government policy to create new jobs and get businesses through the recession.

Describing what he said was "a job revolution that cuts right across all sectors", Mandelson cited how the global market for low carbon and environmental goods and services is currently worth about £3 trillion, and it is projected to grow strongly over the next decade as both the developed and the emerging world makes the shift to low carbon or post-carbon.

"There are over 800,000 people in the UK employed in this sector once you factor in the supply chain," said the business secretary. "Many of them are employed in renewable energy industries, but around half are employed in emerging low-carbon areas such as alternative fuels and low carbon design and development. There are also tens of thousands of people employed in services industries like environmental consultancy and carbon finance."

According to Mandelson, the UK's environmental goods and services sector is the sixth biggest globally and is projected to grow substantially over the next decade. If the UK takes advantage of the opportunities available and realizes this growth, we could see over a million jobs in this sector by the middle of the next decade, he suggested.

However, he warned, this is a "fearsomely competitive" sector, and progress will require a smart, strategic approach from government that makes sure that the business environment is absolutely fine tuned to that outcome - and that includes using things like government procurement strategies to help companies willing to take the leap to develop the expertise that will make them global leaders.

"That means government that ensures that we are developing the right skills base and investing strategically in the right research commercialisation and process innovation. When we launch proposals for the government's low carbon industrial strategy in a few weeks time, it will include commitments to doing all this and more.

Mandelson concluded: "We can't know the future precisely and we shouldn't be trying to anoint British success stories in advance - that kind of prescription is pretty much a recipe for what you might call a 'Betamax economy'. But we do know broadly what we will need to be good at, and that is being smarter and more innovative and creative and more flexible and adaptive and confident and entrepreneurial than the competition.

"The task for government and the private sector now is making sure we get there. No one is trying to order change or run industries from Whitehall. That's not the sort of industrial activism I have in mind. But to identify and pursue the government policies that will support the private sector and draw the benefits from markets to get the jobs of the future we want."