REGIONAL REPORT
( greater than their fall early in the pandemic ) and in August were still down around 15 per cent on the level before the transition period ended . UK goods imports from the EU also fell by over 30 per cent at the start of the year and were still down around 20 per cent in August compared to December 2020 . While goods trade with the rest of the world experienced similarly sharp falls at the start of the pandemic , in August it had recovered to seven per cent below average 2019 levels whereas total goods trade with the EU remained down 15 per cent ,” commented the UK Office for Budget Responsibility at the end of October last year . “ In summary , the evidence so far suggests that both import and export intensity have been reduced by Brexit , with developments still consistent with our initial assumption of a 15 per cent reduction in each ,” it added .
However , it also pointed out that it is too early to reach definitive conclusions because , amongst others , the terms of the TCA are yet to be implemented in full ( meaning trade barriers will rise further as more of the deal comes into force i . e . further customs checks on EU imports in January 2022 etc .) The pandemic has also delivered a large shock to UK and global trade volumes over the past 18 months , making it difficult to disentangle the separate effect of leaving the EU .
The Centre for European Reform has attempted to isolate the impact of Brexit using a ‘ doppelganger UK ’ ( constructed as a weighted average of other countries ’ gross goods trade flows ) as a counterfactual for what would have happened had the UK remained in the EU . That analysis concluded that , since the transition period ended , leaving the single market and customs union had reduced UK goods trade by 15.8 per cent as of August 2021 .
Brexit has also negatively impacted labour markets as large tranches of the EU workforce returned home , as well as reducing the availability of much-needed skills from the departing workers . Its impact has also disproportionately hit smaller manufacturing businesses in the UK , who cannot afford to relocate production and staff to EU countries to continue to sell into EU countries . It has also negatively impacted supply
Population ageing , the pandemic and Brexit have come together to form the perfect storm
chains , as manufacturers who regularly sourced products from the EU are finding with ‘ rules of origin ’ regulations , amongst others .
Productivity in focus
London is over 50 % more productive than any other region in the UK , according to new research from Durham University Business School . With the Conservative government ’ s plans to “ level-up ” the rest of the UK and ensure that there is little disparity between the various regions of the UK when it comes to work , wages and opportunities , the study indicates there is a long way to go in terms of levelling the playing field with London , in terms of productivity .
The research aimed to understand the differences in regional productivity levels , and the underlying factors which have enabled London to become so much more productive than the rest of the UK . The researchers explored whether factors such as the larger levels of multinational ownership , higher engagement in R & D , the size of firms and engagement in exporting were the reason why London-based industry was much more productive than those in other UK regions .
The researchers obtained the estimates of total-factor productivity ( TFP ) of all plants between 1997-2018 , for the eleven administrative regions in Great Britain . Using this data , they were able to effectively measure the impact that each factor had on organisational and industry productivity , and compare this on a regional scale .
UK manufacturing events
The UK will be holding several manufacturing events in the next few months , including Southern Manufacturing & Electronics ( Farnborough , UK ) from 8-10 February 2022 , MACH 2022 from 4-8 April 2022 ( Birmingham , UK ) and the new Engineering Supply Chain show from 5-7 April 2022 ( Birmingham , UK ). Taking place from 6-10 June 2022 , Manufacturing & Engineering Week will be a “ five-day festival of British manufacturing and engineering innovation .” Four exhibitions will be held in Birmingham over 8-9 June 2022 : Manufacturing Expo , Engineering Expo , Maintec and Design Engineering Expo .
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