Britain is built on industry. When I was growing up in Newcastle, it was the greats of our industrial past such as Stephenson, Armstrong and Parsons – Rachel Parsons, the first woman naval engineer – who inspired me to study electrical engineering. Today, as shadow minister for industrial strategy, it is my job to consider how we can grow British industry so that it is not only a tradition, but the bedrock of our future prosperity.
For years, the Tories couldn’t even say the words ‘industrial’ and ‘strategy’ in the same sentence, trading on the ideological fantasy of free markets that function best without any public sector interference. It is a step forward that even this government recognises the need for a long-term vision for our economy; but it is only Labour’s vision that can create an economy for the many.
For Labour, the clue is in the name. Our party is about the value of labour, and the people whose labour it is. Seeing value in people rather than just in the economic surplus they produce. I argue our industrial strategy is challenge-led, mission-orientated, and values-driven in People Power, a new Changing Work Centre (a Community/Fabian Society initiative) report. Our strategy lays out two missions, with more coming, that address the societal issues of our time – climate change and job automation.
First, to decarbonise the economy so that 60% of our energy is drawn from renewable sources by 2030. Second, to build an ‘innovation nation’ with 3% of our GDP spent on research and development and the highest percentage of highly skilled jobs in the OECD. An industrial strategy is about ensuring good jobs for everyone; high skill, high wage, high productivity jobs with proper rights and progression. It’s about ensuring that people in our towns and villages and cities don’t feel left behind and don’t feel alienated from an economic model that doesn’t work for them.
We are now the most unequal economy in Western Europe, with median earnings in inner London a whole third higher than those in Tyne and Wear. Productivity, measured by output per worker, is 32% above the national average in London and 20% below the national average in Wales and Northern Ireland. And only in London and the South East has GDP per head recovered to pre-crash levels. Industrial strategy can heal these divisions, but it requires political will.
Labour’s industrial strategy will rebuild and transform the economy in every region of the UK through local industrial strategies that enable those with the knowledge of the local economy to make investment decisions on a regional level. We will invest in infrastructure, improving connectivity and therefore productivity, an important part of healing our regional divide. This will be backed up by our £250bn national transformation fund, the national investment bank, and a network of regional development banks.
Labour will create a true innovation nation by making technological change work for people across the country. This means investment in the ‘everyday economy’, in sectors such as construction, retail and agriculture, traditionally outside of any industrial strategy, but where a third of our workforce is employed and productivity is a third lower than the UK average. Putting workers at the heart of our industrial strategy means challenging established ideas of high and low value work.
Creating an everyday economy of real, fulfilling, productive jobs is just as important to our economy as commercialising cutting-edge technologies. We will invest in a Catapult centre for retail to drive productivity and wages across the sector, which is one of the biggest employers outside of the public sector, and where the majority of employees are women. Crucially, we will prioritise the care sector. An economy that cares for you is an essential driver of growth.
Increasing the power of trade unions is key to strengthening workers’ rights and ensuring that workers have a say in their own future. Trade unions are essential for raising productivity in a skilled, healthy and happy workforce. They are the collective voice of workers, and workers, through their trade unions, are best placed to negotiate their pay in a framework which includes their employer. Labour’s Ministry of Labour would roll out sectoral collective bargaining, so that workers have control over their own pay, and strengthen trade unions so that every worker gets the support, security and pay at work that they deserve.
Our plans for a National Education Service will create the high-skilled, empowered workforce that the economy of the future needs. It will offer free, quality education to people throughout their lives, and will help close the skills gap and revolutionise learning in this country. Our industrial strategy is about shaping our economic future to include everyone. It is a vision that is regionally balanced and based on our regional strengths. Workers are the creators of our collective wealth, and building an economy for the many means empowering working people in their working lives and beyond.