Deindustrialisation is a powerful force that continues to mould the economic landscape of our towns and regions across the UK. The decline of the UK’s manufacturing and heavy industries has left an indelible mark, its impact varying fiercely depending on a region’s heritage and the speed of that seismic shift.
While the 1980s often steal the deindustrialisation spotlight, its roots run deeper, back to the 1970s. The trajectory is stark:
- From a peak of nearly 23% in the 1870s, the UK’s manufacturing output share had already slumped to under 5% by 1973. The waning influence of manufacturing was a trend decades in the making.
- The 1970s Tsunami: A staggering million manufacturing jobs vanished between 1970 and 1979. Global competition, soaring energy costs, and economic downturns all played their part in this dramatic contraction.
- The 1980s Earthquake: The decline intensified, with another 1.5 million manufacturing jobs lost in the first four years of the decade alone. This era of high unemployment and recession hammered manufacturing communities.
The pain wasn’t spread evenly. The industrial heartlands – the North of England, the Midlands, Wales, and Scotland – bore the brunt of these job losses. Even London, with its significant manufacturing base, particularly in the East End, felt the sting.
The immediate consequences were devastating:
- Mass Unemployment: Traditional industries like coal, shipbuilding, steel, and textiles saw widespread job losses, leaving communities reeling.
- Economic Wasteland: Factory closures and derelict sites became symbols of decline, eroding the local tax base and leading to urban decay.
- Skills Cliff Edge: Workers from traditional sectors often lacked the skills needed for the burgeoning service economy, leading to long-term unemployment and underemployment in lower-paid roles.
- Social Fallout: High unemployment fuelled poverty, crime, family breakdown, and a fracturing of community spirit.
- Brain Drain: Skilled workers and younger generations often sought opportunities elsewhere, further weakening the economic prospects of these areas and leading to ageing populations.
- Knock-on Collapse: Businesses reliant on these major industries also suffered, triggering further job losses and a drain of spending from local economies.
The enduring legacy of industrialisation and deindustrialisation has carved deep regional divides – the persistent North-South split we still grapple with today. Deindustrialisation disproportionately hammered regions in the North, Scotland, and Wales, widening the chasm with the more prosperous South East.
Local, regional, and urban economic development in the UK has been fundamentally shaped by the fallout from this industrial upheaval. Job losses and derelict land became defining features, prompting local authorities to act. Government and EU funding streams emerged as lifelines for economic initiatives.
However – it is worth remembering that the UK manufacturing sector endures. It still produces similar values of output in terms of GVA as it did 30 years ago, it just does it with fewer people.
Change can bring opportunity
While the immediate impact was undeniably painful, deindustrialisation was part of a broader, albeit disruptive, shift towards a more service-based and knowledge-driven economy. This transition, eventually, fostered new industries and jobs in some areas, even if requiring a different skillset.
There were also unexpected silver linings:
- Cleaner environments: the decline of heavily polluting industries led to improved air and water quality in some regions.
- Regeneration potential: derelict industrial land offered blank canvases for redevelopment and the creation of green spaces, although the costs of remediation were significant and time-consuming.
- Brownfield redevelopment (with caveats): some areas saw brownfield sites transformed into housing, retail spaces (though this model now faces challenges), and other sectors. The London Docklands and Gateshead MetroCentre stand as examples, though the long-term viability of retail-led regeneration is increasingly questioned.
- National productivity gains: the national shift towards more productive service industries contributed to overall labour productivity increases.
- Cheaper imports: the ability to import more affordable manufactured goods did increase national disposable income.
The Severity of Impact Depended On:
- The Speed and Scale of Decline: Rapid, large-scale closures were far more damaging than gradual transitions.
- Economic Diversity: Regions with varied economies weathered the storm better.
- Government Intervention: Effective government support for retraining, diversification, and regional development was crucial.
- Local Leadership and Adaptability: The ability of local actors to forge new strategies was paramount for recovery.
In conclusion, deindustrialisation (the decline in manufacturing employment and decrease in manufacturing firms) has left a profound and often painful inheritance on the UK’s local and regional economies. While a necessary part of wider economic restructuring, its uneven impact has fuelled persistent regional inequalities that demand our continued attention and innovative solutions.
The next article – “Industrial clusters and local economies (article 3 of 5 on industrial policy)” will be released on Tuesday 29 April.
