Andy Street is Mayor of the West Midlands, and is a former Managing Director of John Lewis.
While the UK has been stuck in the debate over Europe, a critical domestic policy has been rolling forward, without fanfare, that will determine our future prosperity. The march of technology stops for nothing – not even Brexit – and the businesses and regions which embrace it will be the winners of the future.
After months of preparation, collaboration and consultation, last week saw the launch of the UK’s first ever Local Industrial Strategy – right here in the West Midlands.
As the crucible of the first Industrial Revolution our region was a fitting location to unveil a new approach to business. However, this week’s launch was about looking forward, not back. It saw the dawn of a new kind of industrial thinking, that not only mirrors the changes going on here in the West Midlands, it shows how a Conservative approach to business, investment and innovation can drive regional economies to spread growth and prosperity across the nation.
What has changed? In the twentieth century, industrial strategy was all about scale: the Government would identify potential winners among our biggest companies and back them through investment and policy. In the twenty-first century, industrial strategy must take the opposite approach, opening up opportunity on a macro level, identifying areas of excellence, spotting emerging markets and encouraging a plethora of businesses to grow. This reinforces Britain as a place where competition and challenge are encouraged, and where innovative ideas can take off.
This is the approach that we have taken in the West Midlands, where we have seen powerful growth based on the diversity of our business sectors.
The evidence is there to be seen: more and more new start-ups are picking the West Midlands as their home. Nowhere else outside of London has seen the growth witnessed in our region. Output here has risen by 27 per cent in last five years. Our productivity growth was twice the rate of the rest of the UK in 2017-18.
However, strategy is about recognising your strengths – and here in the West Midlands we have identified four areas that represent major strategic opportunities, where growth can be nurtured.
First of all, with our diverse and growing population, we have opportunities to lead in biomedical research and developing medical devices. Our ability to work with patient data is a major advantage for the West Midlands. With the population of Scotland and the genome of the world, our region could become a global laboratory for data-driven health care.
Second, in the creative field, we enjoy a wealth of design, digital, TV, film, VR and gaming companies, and ambitious universities keen to work with them. Birmingham and Solihull alone have the potential to add nearly 4,000 new creative enterprises and 30,000 new related jobs.
Third, as we move more towards a service-based economy, we expect to see large-scale growth in the Business Services sector. This already employs 400,000 people across the conurbation – with 125,000 more jobs forecast by 2030. There are also huge opportunities to provide business services to the evolving construction industry.
Finally, we aim to build on the Midland’s status as the home of the British motor trade to make it the UK’s centre for mobility. We have the supply chains and transport pedigree to bring huge investment to a renowned automotive sector, as well as light rail and aerospace.
Indeed, we launched our strategy last week with a new £28 million investment in the UK Battery Industrialisation Centre in Coventry, which will develop pioneering batteries for electric vehicles. The investment, through the Industrial Strategy’s Challenge Fund, comes on top of an £80 million initial investment in the centre.
Coventry has always been the heart of the UK’s motor industry, and we want it to be the centre of the emerging global autonomous vehicle industry. We recognise that we are in a race with Silicon Valley, China, German cities like Stuttgart, and Detroit in the US to be the world-wide capital of the driverless car revolution – and thanks to this crucial Government investment Coventry is well on its way to that destination.
The pioneering centre will support the region’s plans to deliver the first fully-operational connected autonomous vehicles before the world descends on the Midlands for the Commonwealth Games, in Birmingham, in 2022.
Through local industrial strategies, this kind of significant, targeted Government investment will create quality jobs, accelerate growth and create a stronger and fairer economy across the country.
Crucially, an agreed strategy ensures the Government and regions commit to a defined plan, ensuring we work in concert moving forward – while also creating a framework for future investment. This puts the focus on implementation, rather than planning. It gets things done.
Choosing the West Midlands as the launchpad of the Local Industrial Strategy concept is a vote of confidence in our local economy, and it is a vote of confidence in the ability of our regions to accelerate the UK’s economic growth.
It is also a vote of confidence in devolution. This region, where much of the modern world was forged, is today enjoying a renaissance. Under the leadership of a Conservative Mayor, the West Midlands Combined Authority – which includes the seven member boroughs of Birmingham, Wolverhampton, Solihull, Walsall, Coventry, Dudley and Sandwell – has adopted a collaborative approach that is seeing real change.
Our region has been transformed into an economic powerhouse that generates nearly £100 billion of goods and services.
However, the success of this industrial vision requires better housing, connectivity, skills, transport and energy. My office has been working on building this foundation, from doubling the number of good-quality apprenticeships by 2030 to delivering £3.4bn of investment in trams, road and rail over the next decade.
We will increase the rate of housing delivery with a £350 million housing plan, investing £250 million in reclaiming contaminated industrial land and developing the skills required through the National Brownfield Institute in Wolverhampton.
But there is so much more we can do. As Conservatives, we must support commerce and the communities that rely upon it. When a backwards-looking opposition regards business as ‘the real enemy’, it’s vital that we provide the investment and leadership to equip industry for the challenges of the 21st century.
I am proud that the West Midlands is leading the way in industrial strategy, just as our forebears did. But this is not about the past – by staying true to traditional Conservative values of backing business and embracing innovation, we are carving out a future where the UK’s regions can power economic growth for the entire nation.