Government launches new Industrial Strategy

“Today is one of the most important days for British industry in a generation. In launching the modern Industrial Strategy white paper, Jonathan Reynolds has demonstrated the government’s commitment to honour its promises and tackle the major structural problems that have blighted UK manufacturing for so long and we congratulate him for doing so.

“Make UK has led the campaign for a new Industrial Strategy for many years, highlighting the three major challenges that were diminishing our competitiveness, hampering growth and frustrating productivity gains: a skills crisis, crippling energy costs and, an inability to access capital for new British innovators.

“The government has listened and the Secretary of State has acted decisively with a joined up strategy which reflects a wider commitment from the Prime Minister and Cabinet alike. The strategy announced today sets out comprehensive and well funded plans to address all three of these structural failings. Clearly there is much to do as we move towards implementation but, this will send a message across the Country and around the world that Britain is back in business.”

“We fully endorse the government’s ambition to be the best place in the world to start, grow and invest in advanced manufacturing and welcome the Sector Plan as the first step to boosting investment in our innovative sector. Today’s plan sets out how government will work with industry to help our businesses become more resilience, boost exports and upskill the people it needs for the future. The focus on place-based initiatives through advanced manufacturing clusters will ensure that more regions across the country will benefit from the jobs and wealth creation that manufacturers deliver for their region.”

“The government has today listened to Make UK’s concerns that industrial energy prices need to be dramatically reduced in line with international competitors. All eyes will now be on the consultation which will set an energy intensity threshold for those companies that will be eligible for these lower rates. With over a quarter of manufacturers saying that electricity costs alone make up 11-25% of their total business costs it’s clear that the manufacturers need to be in scope. We will be pushing hard on ensuring that all of the manufacturing sector receives this support and government moves at pace on the consultation and importantly the implementation.”

“We know that the foundation of any successful Industrial Strategy is people. Make UK strongly welcomes the government’s investment into engineering, and its commitment to reducing the skills gap in our sector. In supporting provision for both recruitment and upskilling, this is a promising start to filling the nearly 50,000 existing vacancies in manufacturing.

“Looking ahead, it is critical that government develops a long-term vision for skills in the sector, ensuring that all contributions made by employers can be used by employers for both the Growth and Skills Levy and the Immigration Skills Charge, and delivering the crucial funding reforms to ensure the training market is equipped and funded to train the next generation of manufacturers.”

“Access to external finance is one of the biggest barriers to growth for small and medium-sized enterprises (SMEs). SMEs make up 99% of the UK economy, so this longstanding challenge has significantly held back the UK economy.

“Today the government has taken decisive action. This announcement of new incentives, backed by an additional £7bn in funding for the British Business Bank, marks a major step forward to support more UK businesses to invest, scale up, and seize new market opportunities — unlocking the full potential of innovative manufacturing companies to transform and grow.”

UK Steel can reveal that the government has adopted three key recommendations for its newly unveiled modern Industrial Strategy to help tackle industrial electricity prices:

1. Increase of Network Charging Compensation to 90% from 2026, matching what is provided in Germany and France – This will reduce power prices by an estimated £6.5/MWh and save the steel industry £14.5m per year.
2. Continuation of the indirect compensation scheme, which compensates the steel industry for the carbon taxes paid via the electricity bills – If this had not been renewed, industrial electricity would have increased by £20/MWh and increased electricity bills by £45m for the steel sector.
3. British Industrial Competitiveness Scheme from 2027, which will provide an exemption for Renewables Obligation, Feed-in Tariffs and the Capacity Market for less electro-intensive businesses – UK Steel estimates that this will reduce power prices for eligible manufacturers by £43/MWh, which the Government states would represent up to 25% of manufacturers electricity bills.

The uplift to Network Charging Compensation from 60% to 90% in line with what is provided in Germany will reduce industrial electricity prices by £6.5 per megawatt hour (MWh) for the steel industry – an incredible £14.5 million per year.

Despite this impactful cut to electricity costs, there remains a £10-16 per MWh difference between European electricity costs, which slaps £36 million per year on steel bills. The reason for the energy intensive industries disparity is wholesale electricity costs, driven by the UK’s reliance on natural gas power generation.

Tackling network charges, indirect compensation and the new British Industrial Competitiveness Scheme are welcome steps on the road to creating affordable energy and an effective business environment. UK Steel has the solution to eliminate industrial electricity price disparities between the UK and its European competitors. In collaboration with the respected energy consultancy Baringa, UK Steel proposed the introduction of a two-way Contract-for-Difference to peg wholesale prices to those in France and Germany, thereby eradicating the price disparity.

Gareth Stace, Director General at UK Steel, said: “The Government has rightly taken action to reduce industrial electricity prices and modelled its new policies on UK Steel’s solutions. UK power prices have for too long damaged the profitability and growth of the steel industry hand over fist, driving away investment and opportunities decarbonise our production.

“The Industrial Strategy is a step in the right direction towards competitive electricity prices and a better, more effective business landscape, but we are climbing slowly up the foothills of the mountain we need to climb. This is an important milestone, but we are not out of the trenches yet. The Industrial Strategy must be the first of many changes if we are to fully unlock the potential of the UK steel industry to back the growth and stability of our economy.”

“This is a big step forward. Businesses across the country were left to wither and die as Conservative governments failed to deliver an industrial strategy for the UK.

“We particularly welcome action on the number one issue facing UK manufacturers – rocketing energy costs.

“This is a great opportunity to rebuild our industry, save iconic homegrown sectors like our potteries, and bring good jobs home.

“As ever, the devil will be in the detail, but at long last we have a grown-up strategy that will allow industry to thrive.”

“This morning’s announcements linking AI research, infrastructure and industrial capacity bring a welcome breadth of focus to the AI debate in the UK. If we are to harness the AI revolution to drive productivity and bring benefits for business, then we need to think not just about investing in the UK’s impressive AI research base, but also we must focus on how to diffuse innovative applications into the real economy to solve urgent problems, from healthcare and education capacity, to greening the grid.

“Policies which stimulate the uptake of AI, especially within the energy and industrial sectors, will help create a dynamic market for new innovations, which will in turn help to solve one of the most urgent challenges in the UK’s bid to be a science and tech superpower: the dearth of growth capital.  The UK has extraordinary depth of deep tech expertise and home-grown success in the technologies we need to scale AI infrastructure – look at the Alphawave and Oxford Ionics deals announced just recently. With a joined-up approach that connects the UK’s AI action plan with the industrial strategy, we can be much more globally competitive and retain the best talent.”

“The publication of an Industrial Strategy – one with automotive at its heart – is the policy framework the sector has long-sought and government has now addressed. Such a strategy – long-term, aligned to a trade strategy and supported by all of government – is the basis on which the UK automotive sector can regain its global competitiveness.

“Making the UK the best place to invest now depends on implementation, and implementation at pace, because investment decisions are being made now against a backdrop of fierce competition and geopolitical uncertainty. The number one priority must be addressing the UK’s high cost of energy, enabling the sector to invest in the technologies, the products and the people that will give the UK its competitive edge.”

“This strategy sets out a clear vision for how to grow the UK economy and is rightly focused on many of the key inputs the country needs to get right to create the conditions for success. The task now must be to move quickly from planning to delivery, rapidly boosting UK attractiveness for investment and returning the country to international competitiveness.

“For UK life sciences, a successful strategy means ensuring the UK is not only a cutting-edge place to research and develop the medicine of the future, but also a country which seeks to embrace and use the life-changing innovations we are developing. This will be the key litmus test for success in the upcoming life science sector plan and the NHS 10-year plan, where we hope to see more detail.”

“Building upon our nation’s strengths as global engineering and innovation leaders, today’s industrial strategy outlines a pathway to the UK seizing a once-in-a-generation global opportunity to become the low carbon technology workshop of the world.

“At BEAMA we’re proud to be celebrating our 120^th anniversary, and looking back through our archives it’s clear our sector has a rich historical legacy of driving innovation across electrical energy systems. The UK is still home to a wide range of manufacturers of clean energy products and today’s announcements will draw on this first-class expertise as we enter a new period of industrial growth.

“We are especially pleased to see the level of financial support being targeted for BEAMA sectors through GB Energy, the National Wealth Fund and the British Business Bank. Our hope is this can help bring forward investment in UK manufacturing to supply the UK’s electrification needs across the grid and in homes. The decision to reduce electricity costs for the IS-8 manufacturing sectors is an incredibly welcome step as we strive to ensure we can compete for investment globally.

“We are committed to continue working with government and our members to ensure the success of this strategy. We need to turn our attention now to the bespoke package of regulatory, financial, and policy measures needed to forge the most attractive investment climate possible.

“Our shared objective should be to deliver sustainable, long-term policies that lead to stable growth in local manufacturing, without disrupting what is also currently a very global and integrated supply chain.

“That is why BEAMA is proud to be driving a Grid Industrial Growth Plan for the Transmission and Distribution infrastructure sector, alongside other industry supply chain representatives and government.  This will allow us to identify our manufacturing strengths and target incentives to capitalise on the greatest opportunities available.

“The forthcoming trade and industrial decarbonisation plans are also essential elements of this industrial strategy which we are pleased to be working on with government.”

“Gas company profiteering has had a huge impact on businesses up and down the country, so it’s welcome news that the government is looking at how to lower costs.

“Our bills are sky-high because our over reliance on volatile oil and gas has kept us beholden to the whim of authoritarian leaders like Putin. The best way to tackle high bills for consumers and businesses is to stop the price of gas from setting the price of electricity, and get off fossil fuels for good.

“Electricity produced by renewables like wind and solar power is three times cheaper than power produced by gas, so why do we allow gas to set the price we pay? It’s a complete scandal. The government must take action to stop gas companies from ripping us off, which will in turn enable renewable energy to bring down our bills for good.”

“The UK’s new Industrial Strategy represents a pivotal moment for British manufacturing, and we welcome the government’s clear focus on advanced manufacturing and clean energy industries as growth-driving sectors. As a UK manufacturer of rare earth-free electric motors, we see our technology as directly addressing the strategy’s dual objectives of economic growth and strategic resilience across multiple priority sectors.

“The government’s record £22.6bn annual R&D investment by 2029/30, combined with this 10-year industrial roadmap, creates the perfect opportunity to establish the UK as a global leader in supply chain-independent clean technology. Our rare earth-free motors eliminate the chokepoint that has created a house of cards across the electric motor industry — dependency on materials controlled by a single nation that threatens the entire clean energy transition.

“Our technology directly supports the government’s ambitious sectoral targets: the £4.3bn Advanced Manufacturing investment programme, the £1bn Clean Energy Supply Chain Fund, and the goal of doubling Clean Energy Industries investment to £30bn by 2035. By addressing critical supply dependencies identified by the new Supply Chain Centre, our motors enhance economic security across automotive electrification, and renewable energy deployment.

“As a North of England manufacturer, we stand ready to partner with government through the Industrial Strategy’s sector-specific plans and Strategic Sites Accelerator programme to scale this technology across the UK’s industrial regions, directly embodying the Strategy’s commitment to growth “not just in London and the Southeast.” This represents exactly the kind of practical innovation that can turn the Strategy’s substantial investment into measurable economic and strategic returns, creating high-skilled jobs while ensuring the clean energy transition proceeds without geopolitical interference. The Industrial Strategy provides the framework – our technology eliminates the dependency that could undermine it.”

“We’ve waited decades for it and, finally, the government’s Industrial Strategy has been published.

“At first glance, there doesn’t appear to be anything new, exciting or ‘immediate’ in there, with the majority of the much-publicised energy savings not actually coming into play for two years – and only after more consultation.

“I would have liked to have seen more bolder plans and the reintroduction of the Manufacturing Advisory Service or something similar, which delivered lots and lots of targeted support to SMEs that made an instant and long-term impact.

“But let’s look at the positives. I suppose it’s a start and the fact it is a ten-year plan gives a bit of added certainty to our sector, unless Labour’s tenure in Whitehall is short lived and this strategy is ripped up in the spirit of political posturing!

“It is good to see Advanced Manufacturing as one of its core sector plans and, finally, it looks like we’ve woken up to the importance of investing in automation and robotics. This new technology makes us quicker, makes us smarter and doesn’t replace jobs – if anything it has the opposite impact.

“I desperately want to believe that the government has finally understood what is required to help make UK manufacturing truly competitive again. We’re not after handouts, just a level playing field so we can take on the rest of the world by playing to our strengths.”

“Today’s £40m investment to create a network of specialist robotics adoption hubs across the UK represents the most significant step yet towards making the UK a robotics enabled nation. These new facilities will accelerate technology uptake and support businesses in understanding and implementing robotics solutions, bringing together businesses, industry partners, and researchers, with each centre specialising in sectors that match their regional industrial strengths and capabilities.

“The National Robotarium, a global research institute at Heriot-Watt University, has demonstrated the potential of this approach – in just three years, we’ve introduced the opportunity for robotics to over 500 companies and supported the creation of over 100 jobs through 14 innovative companies developing everything from stroke rehabilitation robots to grain-monitoring systems. This new investment will enable similar models to flourish across the UK, proving that the UK can move beyond being dependent on robotics imports to becoming a worldwide producer and exporter of cutting-edge technology.

“The global robotics race is accelerating, and this investment finally puts the UK in serious contention. We are ready to use our experience and expertise to help ensure these new facilities succeed in transforming the UK’s robotics landscape.”

P58 of the document proposes: “an expansion of our successful Made Smarter Adoption programme across England with up to £99m from 2026 to support a further 5,500 small and medium-sized manufacturing businesses to take up new technologies”.

Donna Edwards, Programme Director for Made Smarter North West, said: “This is a landmark moment for SME manufacturing. The government’s commitment to expand the Made Smarter Adoption Programme as part of the Advanced Manufacturing Sector Deal is a powerful recognition of the critical role our makers play in driving innovation, growth and sustainability.

“Launched here in the North West in 2019, Made Smarter has helped thousands of SMEs start their digital journey — providing expert technology advice, leadership and skills training, and funding for internships and digital projects. It’s become a proven blueprint for successful rollouts across all English regions.

“The new £99m commitment, highlighted in the Industrial Strategy, gives us optimism for the future. While we await further detail on the proposals, this announcement is a huge vote of confidence in SME manufacturing and the impact of Made Smarter. It gives businesses the confidence to invest in technology, people and long-term transformation.”

“It’s vital the government takes action to improve the business environment for UK manufacturers. The Industrial Strategy includes some welcome measures that could benefit food and drink businesses, such as the expansion of the Made Smarter programme, Growth and Skills Levy flexibility, more innovation funding, and reducing regulatory burdens for business. However, questions remain as to whether critical sectors, such as ours, can access the funding and support mechanisms outlined here.

“Food and drink manufacturing plays a vital role in ensuring the nation’s food security, provides 500,000 high-quality jobs in every UK region, and contributes £37bn to our economy. It’s clear that government has ambitions for Advanced Manufacturing, and we look forward to seeing how this will translate to supporting the growth of the UK’s largest manufacturing sector – food and drink.”

“We are pleased to see the work of Cambridge Industrial Innovation Policy informing the new UK Industrial Strategy, which was released today.

“This includes our work on international research and innovation collaboration in the advanced manufacturing and materials sector, quoted in the sector plan today, as well as our ongoing work with the Department for Business and Trade on the changing value of UK manufacturing sectors.

“We especially welcome the Women in Manufacturing UK Initiative (which is spearheaded by IfM Engage and Cambridge Industrial Innovation Policy) target to reach 35% female participation by 2035, a crucial step toward unlocking talent and tackling persistent skills shortages.

“Despite frequent claims about the decline of manufacturing, it remains central to the UK’s innovation system and economic resilience, accounting for around half of all business R&D investment, driving productivity growth, and providing high-value jobs across regions. While the strategy’s emphasis on investment is right, investment alone will not be enough.

“The real opportunity lies in ensuring that globally significant products – such as medicines, medical devices, batteries, advanced materials, renewable energy systems, next-generation aircraft engines, and industrial machinery – are not only invented in the UK, but also manufactured here. Doing so will help secure long-term economic resilience and reaffirm the UK’s role as a leader in advanced manufacturing.

“Long-term success will depend on reversing the erosion of competitiveness in key manufacturing subsectors. The real challenge now is delivery.”

The new Industrial Strategy could give a vital boost to the Black Country, with investment in skills critical to the region’s growth.

That’s the view from the Black Country Chamber of Commerce, which welcomed the strategy’s priority support for energy-intensive industries, research and development (R&D) and skills development.

Sarah Moorhouse, Chief Executive, highlighted the potential benefits for key sectors operating in Wolverhampton, Walsall, Dudley and Sandwell, including metal processing, advanced manufacturing, automotive and food and beverage production.

She said: “The Black Country is a manufacturing powerhouse with around 3,000 energy intensive businesses operating here – they need electricity bills to come down and they need them to come down quickly as they have sounded the alarm about uncompetitive energy bills for years.

“The targeted support through the British Industrial Competitiveness Scheme is very much welcomed and a positive step forward – but the timescale for this is 2027. We need transitional measures to help our electricity-intensive businesses that will ease long-term cost pressures and it may be that the extension of the Network Charging Compensation scheme isn’t enough.”

The Chamber welcomed commitments to R&D and skills development, including the £1bn Clean Energy Supply Chain Fund and the £450m skills investment.

Sarah added: “These are big figures, and we needed the government to recognise that this is the level of investment required to move the dial. When we ask our members about the challenges they face we hear recruitment is tough, skills is a real issue and the cost of doing business is forever increasing.

“The focus on R&D and skills is crucial for the long-term success of our businesses and we are looking forward to seeing the detail in the coming weeks.

“The Industrial Strategy can help our region build on its advanced manufacturing base and more training and apprenticeships is a step in the right direction, but we must ensure that these opportunities are accessible to our regional workforce.”

The Black Country Chamber of Commerce represents around 1,500 businesses employing a significant number of employees across the Black Country region, which includes Dudley, Sandwell, Walsall and Wolverhampton.

“The £4 bn Industrial Strategy and Advanced Manufacturing Plan launched this week won’t guarantee growth, but they could be the best and most plausible plan we’ve had in years to put British manufacturing back at the heart of the economy.

“Made in Britain’s 2,180 members are already building the future in vital sectors like Defence, Infrastructure, Clean Energy and Transport. What they need now is action, not merely more ambition; we require a delivery that turns these bold words into real-world impact that improves the manufacturing economy.

“This is a long game – perfect for the greatest legacy sector of the UK. The challenge is sticking to the plan, persisting through policy updates, economic shocks and inevitable global turbulence. If government and industry can hold the course together, this energy-intensive strategy could be the springboard that British manufacturing needs to lead on the world stage through its strong focus on honing skills and global competitiveness.

“The whole world is watching, and they want to know exactly what we are making. With that in mind, it’s time to make ‘Made in Britain’ mean more than ever before. More than a mantra and more than a statement of provenance – a fundamental assurance that British-made products represent truly world-class innovation, sustainability, and are, critically, built to last.”

“It is welcome that the Industrial Strategy recognises that the UK’s skills pipeline must begin with school. Young people cannot and should not be made to wait until 16 to start learning the technical and employability skills they will need for careers in increasingly complex fields with growing international competition. To that end, the £9 million creative careers service is welcome.

“The Industrial Strategy is an important policy milestone, and it provides much-needed business clarity and confidence for investment. The Government’s focus on reducing energy costs is a welcome relief, as high energy bills are one of the biggest barriers to UK industrial growth. Yet, with the new British Industrial Competitiveness Scheme not being in place until 2027, businesses need support now. The technologies already exist to manage energy and reduce costs – increased uptake of these should be supported to help all businesses, not just those eligible under the new scheme.

“Equally, a focus on electricity networks and associated supply chains is welcome as they are essential to establishing a more secure, resilient energy system. This approach means greater support for domestic manufacturers who supply vital components needed to meet growing demand in the energy transition. In turn, this can drive growth for regional industrial hubs – at Schneider Electric, for example, we have invested nearly £50 million in Yorkshire over the past two years to meet the increased demand for electrical infrastructure to drive the UK’s clean energy transition.

“Efforts to bolster engineering skills will be critical to plugging talent gaps in manufacturing. Together with accelerating digitalisation and electrification, this will prove crucial to energy security, reducing industrial costs, and building lasting economic resilience.”

“The government’s ambitious plans for the economy should go some way to creating certainty for businesses across the UK. We hope that this certainty will in turn support employers’ confidence in investing in skills.

“We welcome the acknowledgement that the success of the Industrial Strategy relies on the UK having a skilled workforce. We are particularly pleased with the recognition of the important role engineering and tech skills have in underpinning multiple sectors. It’s vital that government links sector plans into a wider engineering & technology workforce strategy and avoids silo thinking.

“We are also pleased to see recognition of the importance of gender equity and diversity in the workforce more generally throughout the strategy. Addressing this imbalance will be vital to achieving the ambitions set out.

“We welcome the commitment for Government, and Skills England, to collaborate regionally and across devolved nations and will look to work with Government to support this effort.

“We look forward to working with Government on how to take the strategy forward, for example, how we create more opportunities for 16 to 19-year-olds, and how the Government can reach 1 million students across every secondary school in the UK and ensure they are offered the chance to learn about technology and gain access to new skills training and career opportunities by 2029.”

The Confederation of British Metalforming (CBM) has heralded the Government’s new Industrial Strategy as the most joined-up and manufacturing-focused plan it has seen in years.

The ten-year vision includes the launch of the British Industrial Competitiveness Scheme, which will see a reduction in electricity costs by up to £40 per megawatt hour for energy-intensive sectors, such as the hugely important automotive and aerospace markets that CBM members regularly supply.

“It has been a long-drawn frustration for everyone involved in manufacturing that the previous government had ignored an industrial strategy,” explained Stephen Morley, President of the CBM.

“But not anymore. Labour has shown a commitment that goes a long way to getting us back on track. I have been critical of some of its measures in the past, yet I have to say fair play for listening to the voice of business, and, specifically, manufacturing.

“The work of the Industrial Strategy Advisory Board, the B5 (especially the CBI and Make UK) has been fundamental, and they have listened to our insights and the feedback of both our members and other important Trade Associations. This has all contributed a major part to where we are today.”

He continued: “The recognition that high industrial energy costs, not just on electricity, have long been a millstone around the neck of UK manufacturing, particularly for our members in forging, stamping, fasteners and fabricated metals. This week’s announcement is a major step towards levelling the playing field with European and global competitors.”

The Confederation of British Metalforming, which represents the interests of 200 members and a sector employing 70,000 people and generating £27bn in sales, did have some caveats.

Stephen added: “Whilst recognising the government’s push to decarbonise, our members will rightly ask when will the support be delivered? Energy savings from 2027 won’t help firms in crisis today.

“Consultation must be rapid, transparent, and inclusive, which means the continued exclusion of gas costs for high intensity users must be addressed. This is absolutely vital for the forging and heat treatment sectors, where prices per ‘therm’ have more than doubled since January 2022 and will never be returning to that price.

“The CBM will engage directly with the Department for Business and Trade and the B5 on the upcoming energy consultation process and will advocate for the inclusion of all core and supply chain metalforming businesses in energy support schemes.

“I believe the Industrial Strategy recognises the importance of SMEs, which is particularly pleasing. Made Smarter is a fantastic example of how targeted support can make a massive difference and it was good to see this being underpinned by access to ‘growth capital’ through public schemes like the British Business Bank.”

CBM CEO Geraldine Bolton was especially pleased to see skills so high on the priority list.

“The commitment to upskill the nation with an extra £1.2bn each year for skills by 2028/29 is excellent news.

“In particular, we welcome the targeted support for skills packages in engineering and look forward to finding out more details about this. We have been lobbying hard on skills and feel we have had real constructive engagement from government on skills for engineering, particularly at level 2 which is in drastic need of reform.

“The CBM has put together many solutions for consideration and hope to see these come to fruition through our partnerships with the UK Metals Council, Enginuity and stronger ties with the government.”

“The announcement on the government’s Industrial Strategy will be broadly welcomed by UK manufacturers as it addresses many of the key challenges that the sector has faced over a number of years, including assistance in upskilling staff, reducing regulatory burdens, attracting global talent and boosting R&D. However, until there is more detail on how these challenges will be addressed, a level of uncertainty will remain.

“One of the key issues which has been highlighted is the reduction in energy costs and an acceleration in grid connections. This has been an ongoing concern for the UK manufacturing industry and while this cannot be changed overnight, it is disappointing to hear that the price reductions will not come into play until 2027.

“A fundamental challenge for the UK is its dependency on gas imports, which are driving market prices. The alternatives are to shift to renewable energy or nuclear similar to France and Germany, where prices are lower. The difficulty with solar and wind is the storage and investment that is required, so the best option may be to lower the demand for gas. The Strategy does state that this investment will be funded by reforms to the energy system, but, as yet, there is no clarity are what these reforms will be.

“Another issue that has been highlighted is the tax environment. In our latest manufacturing report, which gathered views from 1000 CEOs and business owners, the majority of respondents said that the biggest current challenge facing their businesses are the tax increases announced by the UK government in October 2024, which have significantly increased their wage bill as well as creating uncertainty around investment. While the Strategy recognises that more needs to be done to simplify and reform the tax environment to support businesses, it is likely that the earliest we will hear any changes will be in this year’s Budget. Survey respondents also commented that implementing the details of recent trading announcements and improving relationships, particularly with Europe, which remains difficult and bound in red tape, also needs to be addressed as soon as possible.

“While the Industrial Strategy is lacking some detail, as our report showed technology, skills, infrastructure and the ability to access investment were all listed as key priorities for manufacturers, and it appears that the Government has heard and is moving in the right direction to support the industry.”

“The UK’s new Industrial Strategy outlines a compelling vision for growth — but we’ve seen ambitious blueprints before. The challenge now is delivery, and without a shift in how government partners with industry, we risk repeating old patterns.

“Manufacturing has been neglected for decades. High energy costs, increasing employment overheads, and an education system poorly aligned with industrial needs continue to hinder businesses. Vocational colleges often lack proper facilities, qualified teachers, and a connection to real-world skills. The solution? Handing over the training resources to manufacturers, they know the skills required; they should be empowered to shape the talent pipeline.

“The strategy rightly champions AI, life sciences, and clean energy — but these frontier sectors depend on solid foundations: engineering, infrastructure, and core industrial capabilities. Without these, high-value ambitions won’t take off.

“For SMEs, access to finance is a perennial problem. What’s needed is not another programme, but a system-wide simplification: reform the planning process, stabilise energy costs, and streamline the tax code. SMEs are not “soft targets” — they are the engine of innovation and employment. They deserve meaningful incentives, not burdens.

“We must also retain our top talent. The UK cannot afford to see its brightest minds picked off by better-funded foreign institutions. Let’s create an ecosystem where entrepreneurs can thrive through tax breaks, IP access, and reduced bureaucracy.

“The strategy’s aim is clear, and its potential is genuine. However, it must be rooted in the practical realities facing industry. Without solid, industry-informed implementation, we will find ourselves here in ten years wondering what went wrong — again.”