A new report by the Royal Academy of Engineering and Metro Dynamics, Engineering Economy & Place, has revealed that engineering represents 32% of total national economic output and 26% of jobs nationally, but warns that, without action to implement a place-based approach to engineering policy, the UK risks hindering the growth of its economy.
Engineering Economy & Place aims to enhance understanding of the role of engineering across the UK economy, which impacts multiple sectors, from manufacturing, software and R&D to engineers in non-engineering industries like financial services and media. The new data is intended as a tool to inform future policy decisions on how to share the benefits of engineering across society and help the UK to achieve its engineering, science and technology ambitions. The report’s interactive dashboard explores, for the first time, how much, what type, where and in what context engineering is happening and enables places to understand the role that engineering could play in their local economies. While many of the strongest local engineering economies generating high value can be found in the South East, there are also several places across the Midlands, North West and Scotland which are performing above average, and high-value hidden gems to be found in South Derbyshire, North Warwickshire and Ribble Valley.
While the new data paints a detailed picture of the differences between engineering in different regions and local areas, and is designed for local policymakers to use, some broad conclusions about how to address regional imbalances in engineering’s contribution to the UK economy can be drawn:
- Connections between city-centre R&D activity and engineering in surrounding city regions and towns encourage high-value engineering and innovation. These benefits can be maximised by improving connectivity between city centres and ‘near city’ regions and towns, but also between cities and rural areas, where pathways that connect innovation are less obvious.
- Targeted support from government and local authorities should be used to maximise the potential of areas with highly specialised industrial concentrations where there are weaker economic and enterprise environments, that are frequently, though not exclusively, in coastal town communities.
- Places with a lot of applied engineering jobs could be vulnerable to automation taking over technical production and standardised operation roles. Government and business will need to ensure that new technologies provide pathways to create new jobs and enhance employment opportunities.
Additional key findings of the report include:
- The engineering economy contributes approximately £646 billion direct Gross Value Added annually to the wider UK economy.
- Engineering is pivotal in the UK’s emerging economy – engineering businesses account for the majority of businesses in 80% of emerging economy sectors.
- Engineering jobs encompass a wide range of sectors and activities, and not all of these are for engineers - of the 8.1 million people in the UK employed by the engineering economy, 5.7 million (70%) are engineers and 2.4 million work in a non-engineering role in an engineering business.
- South Derbyshire, North Warwickshire and Ribble Valley are hidden gems that generate high-value engineering, including information and communication technologies and scientific and technical activities.
- Hotspots of engineering appear all over the UK, not just in major cities: Mid Ulster, West Cumbria, Flintshire and Wrexham, West Lothian, and Aberdeen and Aberdeenshire are the areas where the highest proportion of the local population is employed in engineering.
- High concentrations of R&D employment are found across London, the South East and the Oxford-Cambridge arc. Outside of these areas, concentrations are found largely in cities, including Edinburgh, Belfast, Manchester and Brighton, and some smaller concentrations in the East Midlands, Cheshire and the South West.
- Connectivity between rural areas with thriving engineering enterprises, like Flintshire, South Cambridgeshire, Aberdeenshire and Bedfordshire, and their wider city-regions could be improved.
Professor Sir Jim McDonald FREng FRSE, President of the Royal Academy of Engineering said:
“Engineering is at the core of the UK’s industrial DNA – it is no wonder that we have a proud history of innovation. This snapshot of the current engineering landscape shows that engineers are drivers of economic opportunity – from R&D to delivering products and services that generate jobs, drive our economy and create value for society. The UK simply cannot become a science and technology superpower without first becoming an engineering superpower. Without a place-based approach to engineering policy, the UK risks maintaining the status quo that currently hinders the potential of its economy – with regional imbalance, city centres disconnected from surrounding areas and untapped capacity for innovation and production.
“The report highlights that additional support for enterprise infrastructure across the country is essential for the benefits of engineering innovation to be shared more evenly. Our ambition is to expand our network of Enterprise Hubs to support engineering-led growth and opportunity in local communities and increase the number of engineering startups in those areas.
“We hope that this new framework for analysing engineering’s contribution to our broader economy will be a useful tool to inform future policy and decision-making for local and national success.”
Notes for editors
- The Royal Academy of Engineering is harnessing the power of engineering to build a sustainable society and an inclusive economy that works for everyone.
In collaboration with our Fellows and partners, we’re growing talent and developing skills for the future, driving innovation and building global partnerships, and influencing policy and engaging the public.
Together we’re working to tackle the greatest challenges of our age. - The Enterprise Hub supports talented entrepreneurs and decision makers to transform breakthrough engineering innovations into disruptive spinouts, startups and scaleups. Delivering impact across the UK with tailored partnerships in Northern Ireland and Wales, with more locations to be announced soon, the Enterprise Hub was formally launched in April 2013 and celebrates its 10th anniversary this year. Over the last decade, we have supported more than 350 researchers, recent graduates and SME leaders to start up and scale up businesses that can give practical application to their inventions. We’ve awarded over £11 million in grant funding, and our Hub Members have gone on to raise over £1.3 billion in additional funding and create almost 6,000 jobs.
- Metro Dynamics has a mission to help places. Set up to provide support and advice in a different way, the team focusses on the reality of how places function and their very different stories and opportunities. Metro Dynamics work across the intervention life cycle, from analysis, strategy, project development, finance and business cases, through delivery, evaluation and monitoring. Their approach is driven by combining the best data and research there is with a deep understanding of the dynamics of places and their communities.