t rate would rise a lot because manufacturing employed more than 2 million people and it may be difficult for people to find new jobs so it a social and economical problem, people will lose their purchasing power.
Chief economist Ms Lee Hopley said: "Manufacturers are ending the year on a high and should enter 2011 on a strong footing" (Press association, 2011, UK manufacturing firms 'strong'). The main reason which explain this growth is the demand from overseas market.
Nonetheless, the manufacturer are facing some major issues while trying to develop themselves; indeed as they all need skills they are struggling against each others to get what they want.
Tom Lawton, of public accounting firm BDO LLP says "Manufacturers now need to take advantage of this continued growth by investing in capital equipment and the skills within their workforce. They should also take the opportunity provided by the UK's competitive currency to grow market share overseas both in the Eurozone and emerging markets." (Press Association, 2011, UK manufacturing 'strong').
We can see improvement in this sector while observing the companies investing in their business, trying more and more to employed qualified persons to face their lack of skills, they also buy new machinery to address the lack of innovation.
Another sign of manufacturing recovery is the high Markit/CIPS rate registered in January. This ratio is composed of several data, collected through questionnaire addressed to 600 industrial companies, which are New, Output, Employment, Suppliers' Delivery Times, Stock of Items Purchased.
As it's showed on the following graph, 'the Markit/CIPS survey for the purchasing managers' index rose to 62 in January 2011 from 58.7 in December 2010, the highest reading since the survey was created in 1992. Levels of new orders rose at the fastest rate in the survey's history' (Financial Times, 1st February 2011, Conflicting data paint picture of a two-speed economy).
Index of production: (Office for national statistics, 13th January 2011, Index of production).
You can see on the previous graph manufacturing production increasing again indeed it experiences a growth of 5.6% in November 2010 compared to the same month the year before.
'The largest contributors to the increase were the machinery and equipment industries which increased by 20.0 per cent, the food, drink and tobacco products industries which increased by 8.7 per cent and the basic metals and metal products industries which increased by 11.6 per cent. The largest negative contribution to overall output was a decrease of 2.8 per cent from the chemicals and manmade fibers industries.' (Office for national statistics, 13th January 2011, Index of production).
The next table shows what drive the competitiveness of manufacturing, and explain that the two main forces which influence the competitiveness are the government and the market. Then, it is easier to understand the different factors involved.
Besides, table 1 classify these factors in order of importance, so it is shown that the most significant driver is 'talent' which concerns skilled people (engineer, researchersa€|) and influence innovation. And then come the cost of labor and materials and the energy cost and policies which composed the 'foundation of manufacturing competitiveness, 'the three drivers are the "foundations" of manufacturing competit