Promise of ’96 waits to be delivered

It wasn’t a bad year. It wasn’t a great year. But there were enough hopeful signs for industry in 1996 to persuade it to greet the new year with hope. The Engineer looks back and forward

Britain’s manufacturing industry faced a stop-start recovery last year. An optimistic outlook on jobs, orders and expansions seemed to collapse by the middle of the year and then pick up steadily during the last three months.

But figures from the Engineering Employers’ Federation just before Christmas suggested the overall prospects for 1997 are good with home demand now more buoyant than export markets.

The structural problems facing industry ran throughout 1996 – low investment, poor education and training, a grimy image for engineering as a career, lack of financial support from the City and a poor spending record in research and development all featured heavily.

But despite the doubters, many of the big engineering companies enjoyed a buoyant year with Siebe, FKI, GKN and British Aerospace all reporting booming sales and profits.

The centenary of the motor car gave plenty to celebrate in 1996 and the British motor industry paraded its achievements in fine style. While the engineering achievements of yesteryear were revisited, the modern day industry enjoyed a renaissance. Investment continued apace with announcements of spending plans led by Vauxhall chairman Nick Reilly, coinciding with extra spending by Rover and Ford.

Mira the UK motor industry research association enjoyed the happy coincidence of its 50th birthday falling in with the centenary of its industry.

Other trade associations had a good year too. The Machine Tool Technologies Association enjoyed a highly successful exhibition, Mach 96, boosted by booming orders.

The merger of the two leading training bodies to form the Engineering and Marine Training Authority went through smoothly and leaves the engineering industry better served for vocational qualifications. This year it faces a Herculean task in reworking and relaunching engineering NVQs.

For the Engineering Council 1996 was a mixed year. Relaunched in January with much hope that it could unify the profession, it was looking decidedly unstable by the back end of the year as powerful voices were lining up to have their say about where things were going wrong. On research and development, a highlight of the year involved some of the 500 schemes put forward to benefit from the government’s Foresight Challenge. This offered £30million for 24 successful schemes. Some real tests remain for the programme as its enters its third phase.

Several famous names left in 1996. Britain’s biggest manufacturing company, GEC, lost the man who ran it for 33 years when Lord Weinstock retired aged 71. His successor, George Simpson was hailed as a new broom, expected to usher in a new management style. And ex-Rover chief John Towers surprised the market twice, first by leaving the car giant amid BMW-inspired management changes and then after being linked with several top jobs, by joining lower-profile, Concentric.

The death of Sir Frank Whittle in August brought unusual public acclaim for an engineering hero.

In September, an acquisitive American, Victor Rice, took over at the newly formed LucasVarity. Towards the end of the year 1,500 jobs were cut and four UK businesses put up for sale. Industry watchers expect more changes.

Some of the sadder moves of the year saw Rolls-Royce put two of its grand old engineering names up for sale: steam turbine power generation business Parsons Power Generation Systems, and International Combustion.

And in July an important Scottish engineering landmark disappeared with the demolition of Ravenscraig’s three massive concrete cooling towers and two distinctive blue steel gas holders.

The struggles of some companies seemed to take all year to resolve. Knock-on problems for Belfast-based Shorts when Dutch aircraft builder Fokker ran into trouble, continued through the year. So too did the slow tale of the privatisation of the Royal Dockyards at Rosyth and Devonport. The story of the environmental U-turn of 1995 continued as Shell published its list of 30 proposals for disposing of Brent Spar. Watch for the shortlist.

As pre-election fever stepped up, the Labour Party looked more like a future government and started to compete with the Conservatives for the confidence of industrialists.

In the end, the lobbying of trade associations, most notably the CBI, got industry the Budget it had asked for. The only sting in the tail was a move to reduce capital allowances on some plant and equipment.

Two important pieces of European employment legislation came into effect last year. The first, which established works councils in big European employers, was ushered in without too much fuss.

Opposition to the EU Working Time Directive, which limits the working week in some circumstances to 48 hours, is likely to go on for much longer. Details of what it means for UK manufacturing should emerge over the next few months.

On the jobs front there was good news for engineers and bad news for their employers. As markets began to pick up, companies in many sectors talked of skills shortages.

The severity of the issue was highlighted by an eager Boeing crossing the Atlantic to woo some of the most talented British engineers to work in the US. The pick-up in employment opportunities was reflected in salary levels for engineers, up 5.6% over the year according to the annual review from Remuneration Economics.

But despite the opportunities, engineering was still failing to sell itself as an attractive career. Early in 1996 we heard that almost half of engineering students do not expect to stay in engineering, next news emerged that places on engineering degree courses were often the only ones vacant as A-level students turned away from technology, and in October industry was still struggling with its task of wooing talented school leavers with one in five modern apprenticeship places unfilled.

The challenge of changing the image of engineering for good will play a large part in industry events this year. Led enthusiastically by Dr Mary Harris, the Year of Engineering Success hopes to be able to unite the profession to market itself to parents, children, the media, and opinion formers. The challenge is to make the outside world understand the achievements of engineers.

Adele Kimber