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Growth industries: the future for the UK's emerging technology sectors

Emerging technologies could be key to Britain’s future as an engineering nation. Stuart Nathan reports

Amid the talk of rebalancing Britain’s economy away from banking and towards manufacturing, engineers are trying to carve out and consolidate their positions in an increasingly competitive world. The government is planning to help emerging technology sectors by setting up technology and innovation centres to coordinate development and protect emerging IP.

These emerging sectors, we’re told, are the key to the UK’s future as an engineering nation. While traditional engineering, such as car manufacturing, metalworking and the process sectors, are important areas for the economy, the real future lies in developing high-value products, often incorporating or made using high-technology methods and materials.

So do these sectors feel that they are, indeed, the vanguard of British engineering? Are they outstripping the rest of the world, just keeping pace, or in danger of lagging behind? And do the government’s plans match what engineers feel their sectors need?

The Engineer takes a close interest in these fast-growing sectors, so we asked some of the engineers at the sharp end, both in academia and in industry, to describe how they see their situation in the context of the world market and within the UK. The results make interesting - and not always comfortable - reading.

The space sector is one that’s often held up as hugely important for the UK. Combining the most advanced technologies of aerospace with both newly developed and tried-and-tested electronics, it straddles the hard-nosed commercial realities of the telecommunications sector, the increasingly urgent calls for information on the Earth’s climate and the ways and reasons for its changes, and the curiosity-driven aspirations for exploration and expanding the boundaries of science. As we’ve reported, the public is often unaware of the UK’s place in the industry - the lack of launcher technology and the UK’s historical lack of involvement in manned space exploration has kept it away from the limelight.

20-22 Galileo-in-orbit-credit-OHB.jpg

However, according to Prof Martin Sweeting, head of space science at Surrey University and chairman of small satellite pioneer Surrey Satellites, the sector is growing faster than most other parts of the UK’s economy. ’Studies in the UK now show that the space sector is one of the highest value-adding economic sectors,’ he said.

Sweeting believes the UK’s strength in this sector stems from a focus on innovation. ’The UK has pioneered the development of service-based businesses such as InMarSat and Paradigm, rather than relying on institutional purchases of satellite hardware,’ he explained, adding that his own firm is applying that approach to Earth observation using small imaging satellites.

Government input to help the sector should be structural rather than financial, Sweeting believes. ’We do not want government hand-outs just to keep the sector alive, as that tends to detract from ensuring that what we deliver is of real value,’ he said. ’Rather, government should provide a supportive tax environment for research and development, and financial underwriting for export, as with countries such as France and Germany.’

One problem faced by the space sector is a shortage of people with the necessary skills to drive development forward at the pace required. ’We continually have difficulty finding high-quality scientists and engineers,’ Sweeting warned. ’The disciplines, which have underpinned the UK’s economy for centuries, are not being valued and, in an attempt to make them more accessible, are also being diluted in terms of the depth of the skills required.’ Space is an international business, he added, and competitors such as China and India are taking a very different tack, producing increasing numbers of highly qualified graduates.

20-22 GIOVE-A-panel-view.jpg

In the automotive sector, the UK’s lack of a home-owned volume producer is often taken as a sign that the industry is dead in the water. Yet engineering expertise, fuelled by the presence of the bulk of the world’s autosport industry in the UK and the approach of certain university departments, is making the country an important centre for low-carbon vehicle development. Electric powertrains and reduced-weight construction are under investigation, with engineering consultancy Arup involved in many of the projects.

According to Arup associate director Tim Armitage, the growth in the sector - with which the UK is keeping pace - is largely being driven by government; although the car companies are sold on the concept, if not the mix of technologies that will be needed to push development.

In his sector’s case, Armitage believes that no further government support is necessary; it’s already taking positive action, he says, and commitments to future development have been given. Development of batteries and hydrogen storage will transform the sector, as improvements in energy capacity and reduction in cost will see electric vehicles come closer in performance and price to internal combustion engine vehicles.

But it’s the public’s attitude that could form the biggest stumbling blocks to the sector’s development. ’The general public is used to personal transport, which has no perceived limit on range because of the ease and speed of refuelling, and people feel that a vehicle with a limit of 80-100 miles may not suit their needs. Yet, 93 per cent of vehicle journeys are less than 25 miles,’ he said. Availability of affordable vehicles is a major problem at the moment, but technological improvements are likely to be accompanied by innovation in the way that we pay for personal transport, such as a switch to a mobile-phone-style tariff arrangement.

The way we pay for personal transport could switch to a mobile-style tariff arrangement

However, Armitage stressed, low-carbon vehicles cannot be seen as a country-specific sector. ’The leading vehicle manufacturers are global,’ he said, ’so they’re looking for a global approach, as are major energy providers.
What’s needed is a concerted cross-border and cross-industry approach to ensure the infrastructure and other solutions developed are compatible.’

Energy train: the UK is leading the renewables sector

Energy train: the UK is leading the renewables sector

The medical-devices sector, however, is one where the UK has been seen as carving out its own leading position. Prof Christopher James, head of digital healthcare and biomedical engineering at the University of Warwick, believes the UK’s strength lies in the promotion of ’space for interaction across the life and health sciences’, and in people with strong backgrounds in technology and healthcare within the science base.

However, James said that, far from leading the market, the UK is in fact lagging in this sector. ’The UK has been slow on the uptake,’ he said ’Biomedical engineering has been hot for a while overseas. New courses are coming on stream but more need to be created - and in new and innovative formats.’ Warwick hopes to lead the way with an MSc in digital healthcare, which is currently in preparation, he added.

When asked about the biggest threat to growth in the sector, James was quite adamant: ’funding of research, or lack thereof.’ However, the technological outlook is good. James believes that improvements in battery performance and power harvesting will lead to smaller, faster implants with greater capabilities within the next decade, while artifical organs will join advanced prosthetics in the surgeon’s toolbox of replacement parts. Meanwhile, improvements in information technology and more efficient management of personal healthcare have the potential to improve the way hospitals treat their patients.

However, that funding gap is looming. James says the government should prioritise funding in cross-disciplinary research and rely less on charities to support technological and medical breakthroughs.

There’s some work to be done on public education, too. ’People should understand just how reliant on technology healthcare has become,’ he said. ’We have gone from strength to strength with innovation after innovation: be it new imaging modalities, life support, diagnostic testing, rehabilitation or even data management for patient records. The numerate scientist or engineer is playing and has played an immense part in bringing healthcare where it is today - and will continue to do so for the foreseeable future.’

“Government should provide a supportive tax environment for research and development”

PROF MARTIN SWEETING, SURREY SATELLITES

One area where the contribution of engineering is undeniable is energy and the UK is seen as playing a leading role in the creation of renewable energy technologies. David Clarke, chief executive of the Energy Technologies Institute (ETI), said development of the sector is being fuelled by the belief that no single technology will be able to meet the UK’s energy needs in a world where fossil fuel availability is diminishing and emission prevention is even more vital.

’It has been said that we need to deploy thousands of wind turbines, have 20 million hybrid and electric cars on the road, build 20 nuclear stations and refit 26 million homes to meet the UK’s targets,’ Clarke said. ’This may be true, but it is more likely that a mix of low-carbon technologies will be required to meet energy demands and security while offering affordability and sustainability.’

The ETI’s members are looking at technologies such as macroand micro-distributed energy, waste-to-energy projects, offshore wind and improved network capacity, and is working closely with the government on how to meet 2020 and 2050 emissions targets, Clarke said. This is one sector, at least, where there is no need for extra incentives to succeed.

opinion poll the questions

Key factors affecting emerging sectors

What is fuelling growth in your sector?

  • Is the sector growing faster in the UK than its worldwide growth rate?
  • What are the particular strengths that the UK has in this sector?
  • Can you pinpoint specific technologies that are likely to hit the market or have a strong effect on the sector in the near future?
  • Are you looking to the government to take any action to protect your sector?
  • What’s the most important thing the general public don’t know about your sector?
  • What’s the major threat to growth?
  • Is the UK’s education sector providing the skills you need to grow?

back story

fund strategy

To have a chance of getting to market, emerging technologies must be backed up by investmentWhile government interventions are an important part of directing development, the market still plays the major role - if products don’t do what they’re needed to do, they won’t sell. One important factor for emerging sectors, therefore, is whether there is an appetite for inward investment in the companies developing new technologies, or in spinning out research from universities.

For the healthcare sector, the picture is mixed. ’Sometimes access to finance to invest in areas that are in competition with the “big players” is hard to come by,’ said Prof James. ’On the whole, though, strategic areas of healthcare are defined and funding is aligned as best as possible.’
In the space sector, there is no shortage of investment. ’When we sold the company [Surrey Satellites] in 2008, there was tremendous interest in purchasing us to provide exactly our type of business opportunity - and this is still the case,’ Prof Sweeting said. ’The difficulty over the past two years has simply been one of cash being available for investing in new and more speculative satellite-based services. It is not that people cannot see return on investment, it is that the payback timescales are rather longer in space than other sectors.’

For low-carbon vehicles, the appetite to invest has sometimes run ahead of the ability, Tim Armitage said. ’Pressure on local government funding has constrained some schemes, but there is a growing body of evidence that private funding is starting to be made available,’ he commented. ’This is a nascent sector and it is likely that new business models will be developed that will unlock further sources of funding.’


Readers' comments (6)

  • The plain fact is that people are apathetic to engineers and what they do, and what they give to society as a whole. People need to be made aware of what engineers contribute to society, what they do, and how they do it.

    How many of the general public realise that without engineers their knickers would have not been designed and made. Their computer, mobile phones, and PDA's have all been designed and made by engineers. The water, electricity, gas, and sewage systems they take for granted have all been designed and constructed by engineers.

    This is the problem, apathy and a lack of understanding of what engineering does, and how it is done, they take it for granted.

    If the taps ran dry, the electricity and gas stopped flowing, their sewers failed, or their modern technological devices stopped working, it would be a different case.

    As engineers we have to get this message across, not only to the general public, but potential investors and Government. Once we are not taken for granted, things may change.

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  • The government is ignoring Engineering education in schools. There is a great opportunity to promote this vital area in schools at the moment as part of the government’s reforms. Instead however Mr Gove promotes the English Baccalaureate, which encourages schools to stop teaching Engineering and concentrate on Languages (ancient or modern) and Humanities (ancient of modern). As we all know the future of this country depends on its young people studying and speaking ancient Greek!

    Perhaps the leaders of industry in this country need to tap Rt Hon Michael Gove MP on the ministerial shoulder and point him in the direction of the 21st Century.

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  • Development of new high technologies is the only street in town if we use our intelligence. But unfortunately our politicians, whitehall advisers and corporate businesses are totally oblivious to how we can create new industrial global bases. They tweak here and there and copy other existing processes, but never think out of the box and where the seeds of future economic dynamism reside.

    In a mere twenty-year’s time to 2031, the UK and the EU will be reaching the limits of despair when trying to capture any major future foothold in the global economic stakes. This will not be due to its people, but their governments with regard to current and medium-term policies. These policies are inherently based in the old thinking that by joining universities and business together we can achieve economic dynamism in the future. It forgets that there are three crucial elements to achieve this – the ‘Ideas’ phase, the R&D phase and the corporate commercialization phase. I say forget, as the primer of this most important energiser for economic wealth creation, the ideas phase, is not taken serious and where it is the most important and fundamental missing factor. For without world changing ideas first the process cannot even begin. The British and EU system does not comprehend what the history of S&T tells us where up to 75% of all the inventions that have made the modern world what it is today, did not emanated within the confines of our universities or advanced corporate research centres of excellence, but in the minds of ‘independent’ innovators, far remote from the final two innovation elements that constitute the ‘innovation chain’. Indeed, the ‘independent’ ideas element is more-or-less nonexistent in UK and EU economic policy. This is unlike what is emerging in the East and where they are now starting to see that the ideas people are the most important commodity that a nation has. In twenty years time therefore with this lack of foresight and new thinking in Britain and the EU, we shall in reality just be hangers-on in the global economic stakes. Therefore for its own good, the United Kingdom and the EU have to start thinking ‘out of the box’ and give total prominence and resources to the initial ideas people. For if they do not we shall see in our own lifetime the inevitable collapse of living standards, the like of which we have shall never have seen before and where our offspring will live to be totally subservient to the economic might and power of the East. That is why it is so vitally important that we create now the innovative infrastructure throughout Europe for our ideas people to flourish and thereby equip our nations with the dynamic products and services that we shall dearly need. When will the UK and the EU realise this is the big question, for it has the most overriding repercussions and consequential economic effects that have never been seen before for the 500 million+ people of the European Union? We really have to start thinking ‘out-of-the-box’ like our Eastern counterparts before it is far too late to stem the economic decline that is now upon us all.

    Dr David Hill
    Executive Director
    World Innovation Foundation

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  • Well almost a year on from the publication of this article and I have read it and the accompanying comments with great interest.
    Having spent most of my professional life in the Senior Management arena of British manufacturing companies I have seen many times the transition of innovative ideas into commercial realism. In my opinion the most important aspect of the process is collaboration. For the hard nosed financial decision makers to collaborate with the innovators and developers needs a leap of faith that many of this persuasion find hard to embrace. It is only when a short term, high yield proposal is proffered that their encouragement and support is forthcoming.
    What's the answer, well again we need to learn the lessons of the East. Longer term moderate returns provide less excitement but increased stability to a nation's ecconomic stability and can act as a welcome buffer to the kind of global eperdemic of devaluation that we are seeing on a regular cyclic basis.
    Sustained educational collaboration with industry would also have a marked beneficial effect on the quality of our engineering seed corn. The current half harted initiatives such as poorly targeted work experience and lack of true apprentice schemes, for the high as well as averagely talented students do not do either sector any credit when we nostalgically pride ourselves as being the crucible of 20th Century engineering advances.

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  • The three most important words in the 21st century to survive and prosper economically will be,
    Communication
    Collaboration
    Cooperation

    Get this philospphy ingrained in corporate UK and we may do something, but where it is long-term, a word that politicians just do not understand.


    Dr David Hill
    Executive Director
    World Innovation Foundation

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  • Pleased to see this is going again.
    It would be good to see challenge based growth industries - but possibly building upon ideas and successes from the UK.
    From the past successes, such as space flight (embarrassingly junked) or our natural uranium reactors (perhaps sell to Iran? Then no-enrichment required?).
    Reviving a can do - or rather a can-make philosophy.
    Other things that the old-CEGB labs worked on - solar thermal and wind-power (including vertical axis) and super-insulation.
    Yes there are issues of affordability - but that is, perhaps, why these are manufacturing led challenges. But we do need to instill people with a sense of vision - and a justified feeling at that; who are these people? Financiers? Govt type beings?
    Funding research for innovative companies; funding it for research for SMEs? Surely they very aspect of affordability would make the amounts small and (possibly) assuage and bankers fretting about risks with the benefits of a successful win.

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