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In a bid to fortify supply chains and rejuvenate domestic manufacturing, UK firms are poised to inject a staggering £338 billion into re-industrialization initiatives over the next three years.
Research conducted by professional services firm Capgemini reveals a substantial uptick in investment, reflecting a strategic shift towards bolstering national resilience and competitiveness.
According to the study, which surveyed 200 supply chain and manufacturing executives at UK firms generating over $1 billion in revenue, the trajectory of re-shoring is gaining momentum. While only a quarter of firms had recently upgraded their manufacturing facilities, a striking 78% of respondents indicated the formulation or active development of re-industrialization strategies.
Key drivers behind this transformative wave include concerns over national security, with over two-thirds of executives deeming the enhancement of domestic manufacturing capability as imperative. Moreover, anticipated benefits extend beyond resilience, with executives foreseeing competitive advantages and sustainability gains from re-industrialization efforts.
Amidst the backdrop of a global manufacturing landscape marked by geopolitical tensions and supply chain vulnerabilities, Western economies, including the UK, are pivoting towards industrial strategies. While the UK has lagged behind in policy initiatives compared to counterparts like the US and the EU, the survey underscores a growing consensus among businesses for more robust government intervention to support re-industrialization endeavors.
Crucially, the study highlights the pivotal role of workforce development in realizing the full potential of re-industrialization. With two-thirds of surveyed executives advocating for a more highly skilled workforce, investment in human capital emerges as a linchpin for sustaining and maximizing the impact of re-industrialization initiatives.
As UK businesses gear up for a transformative period of re-industrialization, the research underscores the strategic imperative of fortifying national capabilities and harnessing competitive advantages in an increasingly complex global landscape.