Welsh Government unveils plan to support transforming the manufacturing sector and embrace the fourth industrial revolution

A Welsh Government plan to support Wales’ manufacturing sector through a ‘perfect storm’ caused by a turbulent global economy and ensuring it is ready to embrace the fourth industrial revolution, is being unveiled today by Economy Minister, Vaughan Gething.

The manufacturing sector in Wales has around 150,000 people, with many thousands more employed in the extended supply chain. It contributes over 16% to Wales’ national economic output, which is significantly higher than the UK average of around 9%.

The sector includes food and drink, Information and Communications Technology (ICT), chemicals, electronics, life sciences, construction, metals, energy, automotive, rail, aerospace, defence and security.

Some of the largest manufacturing companies in the world have established substantial operations in Wales, helping to showcase Wales as a great place to invest. Manufacturing firms in Wales export their goods across the globe.

The Welsh Government’s initial Manufacturing Action Plan (MAP), launched in February 2021, set out the steps needed to develop a resilient, high value manufacturing sector with a highly skilled and flexible workforce able to deliver the products, services and technologies necessary for the future Welsh economy.

The plan is a key part of the Welsh Government’s Economic Resilience and Reconstruction Mission, which sets out how the Welsh Government is rebuilding the Welsh economy, so it is more prosperous, equal and greener.

Since then, the manufacturing sector has and continues to face a ‘perfect storm’ as a result of a number of major challenges, including global competition, a technology explosion, Brexit and new trading arrangements with the European Union, the COVID-19 pandemic, a climate emergency, the soaring cost of energy, delays caused by shipping problems which have disrupted global supply chains, raw material shortages, price increases and serious issues with labour availability.

A survey conducted ahead of the plan’s refresh found:

• 88% of manufacturers said they had faced difficulties recruiting staff.
• 79% said they’d faced supply chain difficulties.
• 75% said they’ve faced pressures caused by rising energy costs.
• 70% felt they needed to upskill their workforce.
• 54% said the impact of Brexit had a challenging impact on their business.

The refreshed plan focuses on ensuring Wales remains a leading manufacturing nation, and on a number of priorities, including:

• Addressing the climate emergency by decarbonising the manufacturing sector in Wales, underpinned by Circular Economy methodology.
• Develop the conditions to anchor key manufacturing companies in Wales, including the provision of modern infrastructure and resilient supply chains. 
• Identify and develop the necessary leadership and workforce skills required to achieve ‘Wales 4.0’.
• Strengthen collaboration between stakeholders to embrace technological change and deliver more commercial innovation at pace.
• Embed ‘Fair Work’ employment principles in Wales, promoting inclusivity, security, and protecting our cultural heritage.
• Mobilising business support to equip Welsh manufacturers to meet future demand for products of strategic importance.

Launching the refreshed plan during a visit to the AMRC Cymru in Broughton, Flintshire, Economy Minister, Vaughan Gething said the Welsh Government’s refreshed Manufacturing Action Plan is designed to ensure Welsh industry is well placed to embrace and benefit from these challenges, including the technological change brought about by the fourth industrial revolution.

Economy Minister, Vaughan Gething said:

“Wales has a rich heritage in manufacturing and can proudly claim to be the world’s first ‘industrial nation’. Wales was right at the heart of the first industrial revolution, a centre of global export, and leading the way in the development of mechanical production and steam power.

“Manufacturing is as important to Wales today as it has ever been and remains woven into the fabric of our national identity. We have a unique responsibility to protect this vital sector and we must work collaboratively with industry and our social partners to ensure it continues to thrive long into the future.”

“Our commitment to supporting our manufacturing sector remains unwavering. That is why it was right for us to undertake a review of the MAP to ensure we continue to make the most of our collective resources to respond to areas of greatest need. The refreshed action plan I’m launching today will help future-proof existing capability, take advantage of future opportunities and respond to some of our biggest long-term challenges.

“While the sector faces significant challenges, they also provide opportunities. The way we address and overcome these challenges together can give Wales a real competitive advantage. I’m confident this will help ensure Wales remains a world-leading manufacturing nation.”

Wales TUC General Secretary, Shavanah Taj said:

“We welcome the refreshed plan and Welsh Government’s commitment to securing good quality, unionised manufacturing jobs across Wales. By consulting with employers and workers, the plan sets out a sustainable future for the sector which is at the heart of the Welsh economy.

“The sector clearly faces big challenges, including the need to decarbonise, the impact of Brexit and energy prices. This plan recognises these and sets out how manufacturing fits in a modern Welsh economy, with a highly-skilled workforce that benefits from well-paid, fair work.”  

Make UK Membership Director for Wales, Janis Richards said:

"It is vital for growth in the Welsh economy that there is a strong plan for industry which builds confidence and establishes a clear ambition - Make UK wholeheartedly welcomes this publication.

“In particular, the Welsh Government should be applauded for consulting so extensively with Make UK members, ensuring that this plan focuses on the real issues that matter to them most."

Chair of Industry Wales, Prof Keith Ridgway, said:

“Industry Wales welcomes the Welsh Government’s continued interest and support for the Manufacturing sector in Wales. We welcome this refresh as both pertinent and timely considering the current economic pressures facing our industries and the wider community.

“Whilst many of the problems faced are UK and International based, there is much that the Welsh Government can do to support industry in Wales. These include support for increased productivity, Skills, Innovation and Supply Chain Development. In particular, by linking supply chain development to our daily needs provides the opportunity to transform our country’s economy for Future Generations. A cross government approach on Policy, Procurement and Projects will anchor and drive a resilient, sustainable supply chain capability whilst enabling quality of employment in all our regions.

“On behalf of all industry sectors, we welcome this focus and prioritisation and we will continue to work with all stakeholders to implement the Manufacturing Action Plan.”

Katherine Bennett, CEO of the High Value Manufacturing Catapult which works to accelerate new concepts in manufacturing to commercial reality said:

“Manufacturing is a key component of a successful Welsh economy. The Manufacturing Action Plan published today shows the Welsh Government’s commitment to creating an environment in which the sector can embrace the benefits and opportunities created by new technologies.  The High Value Manufacturing Catapult looks forward to working with companies across Wales to help them innovate and grow.” 

Unite Airbus convenor, Daz Reynolds said:

“Unite welcomes Welsh Government's review of its manufacturing action plan. Our manufacturing sector is the beating heart of the Welsh economy. Highly skilled Unite members, working at companies such as Airbus, GE and TATA manufacture goods that are exported across the globe.

“Maintaining our manufacturing strength is challenging in a fast-changing world, but it can be achieved if we continue to work together through Wales social partnership structures.

“Good, unionised, well-paid manufacturing jobs support thousands of families and communities across the whole of Wales. Welsh Government's commitment to ensuring Wales remains a vibrant manufacturing nation is an ambition Unite fully supports”.

ENDS