Reindustrialising the United Kingdom

This project is designed to examine the issues that may arise, should the UK seek to reindustrialise.

Project Icon Project Status
Ongoing
Sparks flying off metal work

Summary & aims

The UK’s lagging productivity growth since the 2008-2009 Global Financial Crisis, together with a renewed focus on ‘Levelling Up’ to address regional inequalities and rebalance the economy has led to calls for the UK to reindustrialise. Not only might this improve productivity levels, given that manufacturing productivity tends to grow faster than service-sector productivity, but it could also reduce national vulnerabilities highlighted by the Covid-19 pandemic and the invasion by Russia of Ukraine.

This project aims to examine whether these statements are correct, whether reindustrialisation is possible and, if so, how it could be brought about, and what the implications of reindustrialisation would be in terms of exchange rates and monetary and fiscal policy.

Methodology

Using our Global Macroeconometric Model (NiGEM), as well as existing literature and work on this topic, we will examine a range of scenarios to assess how the UK economy would perform were there to be a concerted policy to reindustrialise by export-led growth in the manufacturing sector.  Within a possibly extended version of NiGEM, we will be assessing the implications for the exchange rate and for UK monetary and fiscal policy.

Principal Investigator

Reindustrialising the United Kingdom
Deputy Director (Macroeconomic Modelling and Forecasting)

Co-Investigator

Researchers

Xuxin Mao
Principal Economist
Patricia Sánchez Juanino
Associate Economist
Kemar Whyte
Senior Economist