What’s the future for industrial towns?

Before winning the election in May this year, I spent three years knocking on doors as the Labour candidate in Redcar and listening to local people’s thoughts and views. The biggest concern raised with me was the lack of jobs, particularly for young people. This concern was an immediate, tangible part of a greater, more existential question about the future sustainability for industrial towns like Redcar and their survival in today’s global economy.

People would tell me how 40 years ago, they would leave school and there would be a guaranteed job at British Steel, at the port or at the huge ICI plant at Wilton. This whole constituency, indeed Teesside itself, the industrial ‘Infant Hercules’ as Gladstone called it, was built to supply the labour for these enormous industrial sites. In its heyday the steelworks would have employed 40,000, Smiths Dock would have hosted 5000 men building ships, and the ICI site 30,000. The ICI site now hosts a number of smaller petrochemical companies, and is about a quarter of its original size. The docks built their last ship in 1987. And the steelworks was shamefully closed in October this year, when Thai company SSI went into liquidation with the tragic loss of some 3000 jobs.

The days of secure, lifelong employment, with an apprenticeship, training and a trade in steel or chemicals in Teesside are long gone. This was British industry in its heyday, with Teesside its own, original ‘northern powerhouse’.

The tragedy was not lost on the people of Redcar who know with great pride that their fathers and forefathers forged the steel that built the world, from Sydney Harbour Bridge to Wembley Stadium, to the New Freedom Tower in New York. The town now feels angry and bereft – at the mercy of todays’ global industrial economy that it helped to build with its own hands, and powerless to compete in the new industrial world order.

The overzealous dumping of steel into the market by China has led to a global price crash, excessive energy costs, disproportionate business rates and a poor exchange rate, all of which have hammered the steel industry. But at the heart of all these factors lies an unwillingness of the UK government to promote an active, interventionist industrial strategy to enable British steel makers to compete in a world where other nations support and empower their manufacturing sectors. In the case of Redcar, the government were too willing to shrug their shoulders and hide behind exaggerated EU state aid rules or blame global forces beyond their control. Workers in Redcar feel abandoned by a government cowed by the need to court Chinese investment, and hamstrung by an ideological abhorrence of state-intervention in markets.

This issue is not new though. Successive governments in the last 30 years have supported the growth and development of the service sector and the financial sector as the engines of the British economy, whilst failing to support the growth of our goods-producing sector to the same level. Manufacturing now makes up just 10 per cent of our economy, while the service sector now stands at 79 per cent. This has fuelled the economic disparity in our country between the north and the south. Northern towns that once made Britain the workshop of the world have been left to fight for survival.

The frustrating thing is that there is so much potential for Britain to be leading the way in new modern 21st century industries. Steel itself is a foundation industry that supports the success of our aerospace and automotives and will be vital in the construction of the major infrastructure such as HS2 that we need in coming years. Yet the industry is being allowed to fail. Carbon capture and storage holds huge potential to tackle our climate challenge and develop new research and technology and is the sort of industrial development that might have regenerated industry on Teesside. Yet the government just cancelled the competition for the first pioneering £1bn investment project. Subsidies for renewables have been cut. These are the kinds of proposals which could be the basis of a new industrial renaissance in the north of England. Yet the lack of government support and investment is holding us back.

My constituents can no longer hear soundbites like the ‘northern powerhouse’ or ‘march of the makers’ without feeling angry and insulted. Over 3000 jobs have been lost in a matter of weeks. The end of 175 years of a proud industry which ran through family generations is a testament that a manufacturing renaissance is very far from the reality right now.