INDUSTRIAL SHIFT IN BRITAIN
Early industrialization in Britain
Our understanding of the current shift in industrial trend in Britain cannot be complete without understanding the earlier industrial growth in Britain. Britain is considered as the mother of industrialization owing the early industrial revolution that took place in the 17th and 18th century. Between 1700 and 1800, there were major changes to took place in Great Britain that later came to be regarded as industrial revolution (Matthews et al., 2002 81).
It all began in 1733 when John Kay invented the flying shuttle that revolutionized the textile industry. This invention made weaving easier and faster on looms and helped cottage industries to process fabrics at a higher rater leading to a shortage in yarns. In 1764, James Hargreaves also invented the spinning jenny which made it possible to turn many spindles at once. There were further improvements with the invention of water frame by Richard Arkwrights in 1769. In 1779, Samuel Crompton perfected the spinning art through invention of spinning mule which had features of spinning jenny and spinning frame. It is these inventions and other that eventually led to a growth of a powerful textile industry in Britain and provided the base for developed of other industries.
The growth of textile industry led to the emergence of factory system which soon replaced the cottage system that had been used for decades. Early industries in Britain were only based on cottages and had limited capacity both in technology, access to raw materials, and market (Matthews et al., 2002 161). The revolution in textile industry enabled production in mass and hence the development of factory system. Apart from changes experienced in textile industry, there were also rapid changes in other industries. For example, metalworking, which had been previously practiced as a cottage industry soon changed to factory industry. The revolution was so fast that in few years, there were many factories which sprang up in various places.
Industrial revolution in the textile industry led to urbanization. The development of factory system made it possible to employ large number of people. People moved from rural areas and settled around factories where they worked. Although this was marked by poor housing and other social problems, it provided the bases for growth of modern cities. Men, women, and children all worked in these factories, albeit under inhumane conditions.
The development of the textile industry catalyzed the growth of other industries. It led to development of steam engine. Steam engine was used in steam pumps which were mounted on iron smelting works too pump air into furnace to smelt iron. This helped in growth of iron smelting industry and also the growth of transport sector. The steam engine was soon used to develop trains used in transportation of raw materials, people, and finished goods. Steam engine was also used in mining coal in deep mines and helped in lifting coal the ground surface from underground mines. The transport sector also rapidly development with the invention of Johan McAdam roads as required by the General Turnpike Act passed in 1773 by the parliament.
Industrial revolution in Britain brought about social, political, and economic changes. There was great advancement economically as people found livelihoods working in industries. There were political changes as government became involved in setting out working conditions especially with enactment of Factor Acts in 1802 and 1819. These acts were made to regulate working conditions especially in reducing child employment. Rise of trade unionism can also be traced to the early industrial revolution. Unionization was considered paramount in fighting poor working condition and fighting for rights of industrial workers.
From Britain, industrial revolution spread to the rest of the world. First it spread to nearby countries like France, Germany, and others before spreading through migration to United States and other Britain colony. It can be argued that British colonialism was basically aimed at providing more raw materials to fuel the growing industry. Most Britons were employed in industries at home or abroad. Industrialization catapulted Britain to become the most industrialized nation in the 18th and 19th century but today it is ranked 6th in terms of industrial production.
Shift to service sector
The momentum that marked early industrial revolution in Britain seems to have slowed down. Rapid development of industries has slowed down and there is an eminent shift in industrial production in the country. Although the country houses all sorts of industries from textile to aeronautical industries, it is evident the glamour and glare that marked early industrial revolution in the country is diminishing, not because the level of industrial production has gone down but the number of people working in the sector has substantially reduced and overall contribution of the sector to the country GDP has also reduced.
During the era of industrial revolution and in the first half of the twentieth century, the manufacturing sector was important to Britain GDP. However, its contribution to GDP has reduced over the years and the service sector is today the largest component of the GDP. According to CIA fact book (2009) the service sector contributed 74.5 of the GDP in 2008 while the industrial sector contributed 24.2 and agricultural sector contributed 1.3. This indicates that the service sector is the most important sector the economy. After the Second World War, the manufacturing sector accounted for more than 40 of the GDP but this has substantially reduced over the years owing to declining output (BBC, 2002). The rise in the service sector has been attributed to the growing trend in the world economy where the service sector is emerging as the most profitable sector. The development of the service sector therefore aligns Britain economy in line with the world economy. Although it may not have been declared an official measure of the economic growth, the services sector is currently an important indicator of the advancement of a country economy. It will be found that countries with larger service sector have an advanced economy compared to countries with larger manufacturing sector. However, there is a close interlink between service sector and manufacturing sector in the sense that both complements the other.
It is evident that although Britain is ranked number 6th in industrial production there has been a decline in the manufacturing sector in the country. This is generally attributed to two factors. First, there has been shift of industries from higher wage economies to low wage economies. Second, there has been unprecedented growth of the service industry and stakeholders who previously operated manufacturing firms could have shifted to service sectors. This explains that this change could be aligning with overall change in the global economy. The following graph shows the decline in Britain industrial production since 1990
Adapted from BBC (2002)
The above graph clearly illustrates that the manufacturing sector in Britain has been on the decline. The graph shows a dip in the manufacturing sector in 1991-1992 and then a sudden peak in manufacturing in 1994-1995. This graph shows an unsteady growth in the manufacturing sector in Britain since 1990. The worst trend is however recorded from 2000 where the graph shows a step dip in industrial production going below the 1992 levels. Therefore it is evident that the manufacturing sector output has declined at an alarming rate since the turn of the century and if anything it paints a grim picture of the future of the sector.
Analysts argue that this has been attributed to years of underinvestment (Moore and Briscoe, 1999 39). This is generally contributed by many factors including internal and external factors. Unlike other countries, Britain has not been in a position to attract internal and foreign direct investors which puts a question on the prevailing government policy. However, analysts points out the emergence of low waged economy in Asia especially China which has attracted a large number of foreign investors. While Britain continue with high wage policies which are meant to align with standard of living in her cities, countries like China have taken advantage and propagated low waged economies, tax breaks, and generally low cost production economies attracting thousands of investors. As can be seen in the graph below, there has been decline in investment in the manufacturing sector in the country since 1990s. This has dealt a blow to the continued reinvention of the manufacturing sector.
Adapted from BBC (2002)
The decline in the manufacturing output in UK has also led to a decline in employment in the sector. At the turn of the nineteenth and twentieth century, the manufacturing sector was the largest employer in Britain but it has been overtaken by the service sector. About a hundred years ago, more than seven million workers were employed in the manufacturing sector but today, this number has drastically reduced to about three million. Of the 31.2 million people in the Britain labor force, only 18.2 work in the manufacturing sector while more than 80.4 work in the service sector with about 1.4 working in the agricultural sector (CIA Fact book, 2009). However, research shows that about 2.4 million jobs in the service sectors are supported by the manufacturing sector which ascertains the relationship between the two industrial sectors. As can be seen in the graph below, the rate of employment in the manufacturing sector has been on the decline over the years since 1970s
Adapted from BBC (2002)
The above graph shows that the total employment in the manufacturing sector has systematically reduced over the years to its low in the turn of the twentieth century. This has been attributed to the declining level of investment in the sector which means there are few new jobs which are being created in the sector.
In apparent shift in the global economy, there has been evident change in the industrial establishment in the country. Emergence of new industries has showed a patterned change in production and employment. For example the aerospace industry which is relatively new in the economy having been established after the First World War it today one of the largest employer in the manufacturing industry with more than 100,000 employees. Although mechanization has reduced employment, faltering rate of employment can be attributed to declining investment which means that there are fewer new jobs that are being created in the sector (Matthews et al., 2002 198). There are some industries which have declined over the years and have been replaced by more profitable industries. For example the industries which fueled industrial revolution including steel, coal mining, textiles, and others have reduced over the years and have been replaced by efficient and less labor intensive industries like pharmaceuticals, electronics, and others. This partially explains the reduction in the number of employees in this sector. However, relocation of industries to low wage economies can also be pointed out as a major factor leading to reduction in employment in the sector (Rowthorn and Ramaswarnyl, 1997 12). Most industries have relocated to Asia, South America, and few to Africa where cost of production is relatively low compared to Britain.
However can this phenomenon be explained
It is difficult ascertain whether Britain is experiencing de-industrialization or aligning to global market demand. In its definition, deindustrialization is described as social and economic change which signifies removal of industrial capacity in a country, especially considering the heavy industries, and marked by a shift to service sector (Kucera and Milberg, 2003 192). Although there are many definitions that befit deindustrialization, the shift from industrial capacity to service capacity as a percentage of total GDP output put across a sound meaning. Considering this definition, Britain can be considered to be experiencing a decline in industrial output and at the same time it is aligning its economy to the global market trend.
As was highlighted earlier, the global market is experiencing unprecedented change and most countries are now gearing towards development of service based economy. All over the world, the service sector is contributing a larger part of world GDP and therefore this phenomenon is not peculiar to Britain alone. Apparently, Britain has been moving in line with the development in the world market where the demand is leaning more on the service sector compared to manufacturing sector. The government has also moved in line with demand in the world market to implement policies that are geared towards supporting the service sector. Therefore the government efforts in developing policy framework that supports the service industry is in line with the global economic trend and does not in any way signify lack of support for the manufacturing sector. Although Britain is experiencing deindustrialization, this has been necessitated by the trend in the global business environment where the demand is leaning towards the service industry.
Conclusion
Britain was the first country to experience industrial revolution in the world. This was necessitated by a number of inventions especially in the textile industry which formed the base for industrial revolution. Form Britain, industrial revolution spread to other countries and later all over the world. For many years, the manufacturing sector has been an important sector of the Britain economy but this has substantially changed since the second half of the twentieth century. Years of low key investment in the manufacturing sector has reduced the overall manufacturing output and employment. Reduction of the manufacturing sector has been attributed to different factors including emergence of low wage economies in China and the rise of the service sector. Although Britain is experiencing deindustrialization, the shift towards the service sector has been attributed to change in global business environment.