engineering 2021

A year ago, we were still trying to come to terms with Brexit and then the spectre of Covid-19 enveloped the world. We progressed from coping with issues around supply chains, trade, recruitment and international collaboration, to battling with a global health challenge that would affect every economy and relationship on the planet.

Almost exactly a year on, and with vaccines now being rolled out, national conversations are about recovery. Since March 2020, 700,000 people have lost their jobs and the UK economy has seen its biggest fall in 200 years, while the government has borrowed a record £350bn, the highest sum since World War II.

How has the Economy Been Affected?

The Office for Budget Responsibility expects the economy to return to pre-pandemic levels by the middle of 2022, six months earlier than it predicted in November 2020. However, it has also forecast that over the next five years the economy will be 3% smaller than it would have been.

The just-delivered budget, including the publication of ‘Build Back Better: our plan for growth’, recognises the potential of the UK’s high-growth, innovative technology companies alongside the importance of additional government investment in the green industrial revolution and broadly was welcomed by industry.

Stephen Phipson, Make UK CEO, welcomed the government’s recognition that the recovery needed to be investment-led, adding: “We must now seize the opportunity provided by new technologies and the drive towards net zero to set out a longer term vision for the economy.”

This identifies one of the biggest focuses for this year and beyond. Covid-19 has brought worldwide attention to the climate crisis. The opportunities in the green/low carbon economy are huge and are likely to see big growth in the UK and internationally from 2021 onwards.

Those organisations that are quick out of the blocks can capture market share and develop expertise to tap into massive global markets as well as future proofing themselves, rather than locking in high carbon emitting processes. At the vanguard will be businesses which are able to take advantage of fiscal stimulus packages and pivot now rather than later.

Additionally, without strong commitment by energy-intensive industries, it will be almost impossible to reach net zero targets in the near to medium future and as a result it indicates a move towards repurposing materials and resources, adopting renewable energy sources and reducing waste in the manufacturing process at every step.

Where are the opportunities?

Perhaps the greatest opportunities in the period of renewal and recovery lie in Industry 4.0, namely industrial digitalisation. Our digital capabilities have clearly been examined in the last year, but now a great acceleration in the use of technology, digitisation, and new forms of working needs to take place.

According to research carried out by The Engineer towards the end of last year, digitalisation and automation are two areas whose importance has grown through the pandemic. Asked to rank a number of key industry trends in order of importance over the coming months, their respondents identified these two areas as priorities. Indeed, 54% of respondents said that the pandemic has acted as a spur to innovation within their own business.

Research by The Manufacturer commissioned by IBM has also recently been published. It revealed that two thirds of respondents to their Digital Transformation Assessment are accelerating their investment in digital projects and putting people at the heart of the process who are able to act on ‘big’ data decisively and effectively.

Digitalisation is crucial to ways of working and improving operational efficiency as well as recruitment and skills. It offers opportunities for upskilling staff across the sector or to even take up a new role to utilise advanced tools and processes. Once the transition is made this is likely to increase an organisation’s earning potential and business sustainability.

Industry 4.0’s influence is growing quickly, and it will not be long before the physical and digital worlds are interlinked as never-before, revolutionising businesses’ productivity, creativity, and profitability.

Given the continuing uncertainties, it is ever-more crucial to embrace innovative new ways of working to maximise productivity-per-head, ensuring that output is not further affected by talent shortages.

In his response to the Budget, Sir Jim McDonald, president of the Royal Academy of Engineering, said: “…our ambitions on net zero, infrastructure and digitalisation are threatened if we do not have the number and diversity of people with engineering and technical skills needed to deliver them.”

Chancellor Rishi Sunak confirmed a raft of new investments for the FE and skills sector. They include: reforming technical education, including aligning the post-16 technical education system more closely with employer demand; focusing on the quality of apprenticeships and improving the apprenticeship system for employers; rolling out employer-led skills bootcamps across England for adults to upskill and reskill in a flexible, bitesize way.

Other measures include doubling the incentive payments for all new apprentice hires of any age up to £3k; an additional £126m for high quality work placements and training for 16- to 24-year-olds, to attract a further 40,000 traineeship starts in the next academic year; “flexi-job” apprenticeships from January 2022 for training across multiple projects with different employers; a £520m help to grow scheme to upskill 30,000 small and medium-sized enterprises.

What will the Focus be?

What is clear now more than ever is investment and focus on a more sustainable and resilient future is inextricably linked to our human resources. The need for employee safety at all levels has been paramount in the last year and that will not change in 2021 and is likely to accelerate as regulations evolve and manufacturers work to build safer environment. As in the last 12 months, there will be a greater reliance on smart equipment and real time communication technology to ensure that both health and safety is universal and that teams can collaborate more easily.

Industry reacted superbly to the challenges of 2020, although the year ahead will undoubtedly bring continued challenges. Step forward the engineers and manufacturers who, as problem solvers and innovators, will be central to any recovery.

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