Does the long goodbye to manufacturing spell recession?
British manufacturers are giving up the fight. Their share of economic activity, employment and exports has been falling for decades. Now they are locked in a vicious recession, but nobody cares. The new intellectual and political consensus is that manufacturing no longer matters. The future is the knowledge economy and the service sector. Manufacturing is yesterdays story: very Old Labour, very uncool Britannia. Yet over the next couple of years the weakness of British manufacturing will start to matter a lot. For unremarked amid the rising sense of near euphoria that Britain is not, after all, likely to have a full-blown recession is an increasingly dangerous statistic. Britains balance of trade in the exports and imports of goods is moving into a staggering deficit as our manufacturers give up the ghost. Last year it was 20.6 billion; this year it promises to be 27bn and next year well over 30bn. And, as the IMF warns, if Britains extraordinarily high exchange rate does not fall, th
