I spent some time picking through the Industrial Strategy Green Paper released yesterday. I'll cover this in more detail in a forthcoming episode of #LEDConfidential but here are my initial thoughts, which may well change / mature in the coming months!
In summary, I think it's almost as good as we could have hoped for given the constraints and requirements of timing, constitutional matters, and economic necessity. In my view, the government needed to lay down some clear markers for priorities and funding with this consultation (with it being in active discussions with investors and places); and set out how the process for finalising the strategy would play out, the key decision points, and how it would engage with experts, industry, and place leaders.
I think it basically does this. It is explicit about what hasn't been decided (e.g. sub-sectors of the 8 priority industries, and the location and definition of high-potential clusters in places), and how it will fill in the blanks (using sector plans, Local Growth Plans, bring in external expertise through several new institutions).
The timing for finalising the strategy ties in with those that Combined Authorities and other devolution deal areas are working to for identifying clusters and working on LGPs. To link, explicitly, the devolution agenda and the structures / processes that define it to the strategy is welcome. Too often national strategies are place-blind - which is not only bad strategy but deleterious to the cause of decentralisation.
The consultation draft lays down some clear and important markers, even if the detail is missing at this stage:
- Priorities are based around 8 sectors, sub-sectors, and 'High Potential Clusters' in places
- The UK's new Trade Strategy will be informed by its Industrial Strategy, which is the right way around!
- Positive mood-music around attracting talent from overseas, re-engaging with the EU and wider world to promote trade ties
- Local Skills Improvement Plans are here to stay, confirming what Labour had hinted before the election but had hitherto not confirmed
- A heavy focus on institution building and mechanisms for engagement
And something interesting from the strategy's baseline analysis...it explicitly acknowledges the decline in UK business dynamism over the last 20+ years (the rate at which jobs are reallocated from lower to higher productivity businesses through firm entry and exit). This has been a focus of enterprise research by the Enterprise Research Centre (UK), The Productivity Institute and others, and it was my big takeaway from the ERC annual conference a few weeks ago. But this is the first time I've seen this insight put at the heart of a government strategy. The bottom line is that enterprise policy needs to be re-oriented towards scale ups, and encouraging more new enterprises with the potential for scaling up.
