CBI: 50 YEARS OF BUSINESS INNOVATION | THE BIG PICTURE
The sector accounts for 83 per cent of jobs – it was less than 50 per cent in 1960 – and registered a trade surplus of almost £58 billion in 2011. It is plainly the engine of growth in the modern British economy. Because it makes up such a vast share
of the economy, it is impossible to look at the sector as one large, amorphous body. Services vary hugely in terms of the levels of technology and innovation they use and develop, and in the wages they pay. The largest share of the private services sector, which makes up 72 per cent of all services, is drawn from professional, technical and support services, followed by business services and finance. The sector includes highly skilled activities in which the UK has a global lead, such as architecture, advertising, insurance and legal services, to name just four. But the private services sector also includes the vitally important sub-sectors of transport, storage, retail, communications, hotels and restaurants as well as the leisure and culture industries. Britain has realised the future lies in high-
value manufacturing, financial services and value-added businesses such as electronics, ICT and biotechnology. The route to success is by ensuring that organisations in the services sector – both public and private – continue to focus on delivering excellent quality in a way that will both attract overseas buyers and deliver affordable solutions to consumers and other businesses.
FORGOTTEN ARMY The fast-growing businesses of today are in niche areas such as website management, IT design, e-commerce and the creative industries, areas that did not even exist 20, let alone 50, years ago. They are attracting the highly educated, skilled and ambitious candidates who in the
Right and opposite: The FT30 equity index is now dominated by hi-tech, knowledge-based industries
past would have prized a lifetime career at a traditional blue chip company. The CBI’s membership now includes universities, charities, social enterprises and health providers as well as more traditional businesses familiar from 1965. Thanks to a concerted campaign by the CBI,
there is now a real focus on the importance of medium-sized businesses – the British equivalent of the German mittelstand. Incoming director- general John Cridland took a positive decision in 2011 to highlight the importance of this “forgotten army” of medium-sized businesses (MSBs) which represent less than 2 per cent of businesses but generate 23 per cent of economic revenue and 16 per cent of all jobs. The result was a major report, Future
Champions, which showed how harnessing MSB potential would unlock £20–50 billion of economic output, create job opportunities across all regions of the UK and help rebalance the economy and close the gap with our main rivals. It set out a 12-point plan that included recommendations to the government to: • make bond markets more accessible to MSBs • encourage large firms to work with MSBs in their supply chain to share best practice and increase levels of leadership, innovation, exports, recruitment and financing
• recruit more MSBs to the Prime Minister’s Business Advisory Council.
The report and the research behind it have
clearly influenced political thinking amid signs that the government recognises the needs of MSBs. In November 2011, it published its Mid-sized Businesses Growth Review and, the following month, Business Secretary Vince Cable announced a £125 million fund to support UK advanced manufacturing sectors such as aerospace, automotive and chemicals. The 2012 Budget included an allocation of £700 million for the Business Finance Partnership to provide alternative sources of finance to small and medium-sized firms.
034
Since the start of this decade the CBI has
been urging politicians to tilt the playing field in industries where the UK has competitive advantage and significant expertise. In its 2012 report, Playing Our Strongest Hand, the CBI suggested that the government should maximise existing strengths in strong sectors such as aerospace, automotive, agri-food, green technology and services, creative industries, chemicals and pharmaceuticals, and knowledge-intensive business services. That message has been heard and the
main political parties have moved towards a new industrial strategy that emphasises linking up policies in areas like skills, infrastructure and regulation that deliver benefits across sectors. Rather than picking winners, the government must ensure that British businesses in any sector compete on a level playing field. The commensurate decline in the number
of people working in factories and the increase in office workers has struck a chord with people concerned about the loss of Britain’s industrial heritage. However, the message of the 50 years since companies such as Leyland Motors and the London Brick Company graced the FT30 index is that the UK has a greater depth and diversity in its business sectors than would have been found in 1965.
•
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84 |
Page 85 |
Page 86 |
Page 87 |
Page 88 |
Page 89 |
Page 90 |
Page 91 |
Page 92 |
Page 93 |
Page 94 |
Page 95 |
Page 96 |
Page 97 |
Page 98 |
Page 99 |
Page 100 |
Page 101 |
Page 102 |
Page 103 |
Page 104 |
Page 105 |
Page 106 |
Page 107 |
Page 108 |
Page 109 |
Page 110 |
Page 111 |
Page 112 |
Page 113 |
Page 114 |
Page 115 |
Page 116 |
Page 117 |
Page 118 |
Page 119 |
Page 120 |
Page 121 |
Page 122 |
Page 123 |
Page 124 |
Page 125 |
Page 126 |
Page 127 |
Page 128 |
Page 129 |
Page 130 |
Page 131 |
Page 132 |
Page 133 |
Page 134 |
Page 135 |
Page 136 |
Page 137 |
Page 138 |
Page 139 |
Page 140 |
Page 141 |
Page 142 |
Page 143 |
Page 144 |
Page 145 |
Page 146 |
Page 147 |
Page 148 |
Page 149 |
Page 150 |
Page 151 |
Page 152 |
Page 153 |
Page 154 |
Page 155 |
Page 156 |
Page 157 |
Page 158 |
Page 159 |
Page 160 |
Page 161 |
Page 162 |
Page 163 |
Page 164 |
Page 165 |
Page 166 |
Page 167 |
Page 168 |
Page 169 |
Page 170 |
Page 171 |
Page 172 |
Page 173 |
Page 174 |
Page 175 |
Page 176 |
Page 177 |
Page 178 |
Page 179 |
Page 180 |
Page 181 |
Page 182 |
Page 183 |
Page 184 |
Page 185 |
Page 186 |
Page 187 |
Page 188 |
Page 189 |
Page 190 |
Page 191 |
Page 192 |
Page 193 |
Page 194 |
Page 195 |
Page 196 |
Page 197 |
Page 198 |
Page 199 |
Page 200 |
Page 201 |
Page 202 |
Page 203 |
Page 204 |
Page 205 |
Page 206 |
Page 207 |
Page 208 |
Page 209 |
Page 210 |
Page 211 |
Page 212 |
Page 213 |
Page 214 |
Page 215 |
Page 216 |
Page 217 |
Page 218 |
Page 219 |
Page 220 |
Page 221 |
Page 222 |
Page 223 |
Page 224 |
Page 225 |
Page 226 |
Page 227 |
Page 228 |
Page 229 |
Page 230 |
Page 231 |
Page 232